Why does insurance fraud increase during a recession?

An Insurance Business Magazine article.

Insurance claims tend to skyrocket during times of recession, and, according to statistics, so does insurance fraud – something industry experts say can only be tackled through strong collaboration among insurers.

The Insurance Council of New Zealand launched its own fraud bureau last year, and, according to its 2019 data, $688 million out of the $1.31 billion in paid claims is estimated to have been a result of insurance fraud. That number is expected to rise thanks to the COVID-19 pandemic and recession, and ICNZ said financial hardship is likely to be a key driving factor.

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