Business insurance

Around 40% of SAs think it’s okay to lie about insurance claims and income, new survey finds

  • Around 40% of South Africans surveyed by a global data analytics company see nothing wrong with lying about their income or insurance claims.
  • The desire to exaggerate income when applying for a mobile phone contract is the most common.
  • Many respondents also see nothing wrong with inflating the value of the property in an insurance claim.
  • Lying about income to get credit or a contract is fraud, as is inflating insurance claims.
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About 40% of South Africans find it acceptable to exaggerate income on credit applications and inflate insurance claims, according to a new survey by global data analytics firm FICO.

Many South Africans have no problem committing first-party fraud by lying about their income when applying for loans, mobile phone contracts, car finance or a mortgage. The same can be said of exaggerating the value of property in an insurance claim and even, though to a lesser extent, of adding items to such a claim that have not been lost. , stolen or damaged.

“Many South Africans are experiencing an increase in the cost of living and might consider that they can ease their situation by falsifying information in credit applications,” said Michelle Beetar, who leads FICO’s operations in Africa. The credit-focused data analytics firm surveyed 1,000 South African adults in August, with study results released on Monday.

“However, this misrepresentation is a fraud.”

First party fraud is considered acceptable by many (FICO)

More than 45% of people polled by FICO found it acceptable – and in some cases normal – to exaggerate their income when applying for a cell phone, making this the single largest example of willful first-party fraud. discovered by study.

Thinking a little wrong about exaggerating income when applying for a bank account and financing a vehicle were the second and third most common instances of misrepresentation, respectively, both exceeding 40%.

South Africans surveyed were the most reluctant to add items to an insurance claim that were not, in fact, lost, stolen or damaged, with less than 25% saying they would commit first-party fraud in this case. Nearly 40% of respondents said they see no problem with inflating property value in an insurance claim.

“Financial institutions that can detect anomalies suggesting that information is exaggerated or inaccurate can take positive steps to protect themselves from losses that would occur when the customer cannot afford the repayments, and the customer may be prevented from borrowing a path he will end up regretting,” Beetar added.