Solving subsidence using pioneering technology

As many property owners and insurance professionals will agree, subsidence of a property is devastating news for the owner. Levelling a sloping, uneven building is traditionally an intrusive and time-consuming process that can carry a hefty price tag for both claimants and insurance companies.  However, with advances in technology, traditional underpinning methods are no longer the only option and instead insurers and loss adjusters can collaboratively adopt a technology led, injection solution that requires little to no excavation, creates minimal mess, is extremely accurate and often allows the occupants to reside in the property while the work is carried out. 

What is injection technology?

Historically, ground engineering solutions haven’t been the most cost-effective option for both property owners and insurance companies. What’s more, due to the invasive nature of traditional methods, as well as the inconvenience caused by these processes, it’s often the last resort. However, advances in new technology means that expensive and inconvenient methods are now a thing of the past, with injection processes becoming a far more viable solution.  It’s now possible for home owners, insurance companies and loss adjusters to use non-invasive methods to raise and strengthen a building. For example, Mainmark offers two non-invasive injection solutions including Teretek®, engineered resin injection and JOG Computer-Controlled Grouting, which delivers a high mobility cementitious grout mix to a multitude of injection ports under precise computer control. The JOG computers control the grout monitors, injecting every few seconds to gently and precisely raise, or “float”, the entire structure back to level. 

This advancement in technology is a real game changer when it comes to policy claims, as it allows the loss adjuster to offer a far quicker and reliable solution that is financially beneficial for both parties.  What’s more, these new advanced solutions remove the insurer’s responsibility to provide alternative accommodation for the claimant, as the homeowner can remain in their property whilst the work is carried out. Not only does this simplify the claim process but it also enables the insurance company the save money, as alternative accommodation can often end up costing more than the remedial ground work itself.    

So, how does this work in practice?

Recently, Mainmark came to the assistance of a Macclesfield homeowner, whose two-story brick house had started to subside by as much as 82mm. The homeowner was hoping to renovate the property but needed to fix the structural issues beforehand. There were a number of options considered by the homeowner including traditional underpinning. However, not only would that have simply stabilised the property and not lifted and re-levelled, it would have taken a prolonged period of time. Due to the tight timeframe as well as the cost and disruption associated with those methods, the homeowner decided to appoint Mainmark and utilise their computer-controlled injection process. This solution allowed the homeowner to continue with his renovations in a timely manner and helped prevent future subsidence issues, as the material used in Mainmark’s JOG process strengthens the foundation ground whilst lifting and re-levelling.

The Mainmark team faced a number of obstacles during this job including the amount the house was sloping; the entire 64m2 structure needed to be lifted. Adding to the challenge, the Mainmark engineers had to carry out the work with limited site access due to the narrow, shared driveway, however, because JOG equipment is self-contained it reduces the ‘site footprint’ and allows for easy access.  Furthermore, because of the renovations that were due to take place, Mainmark was tasked to complete the project within a five-day timeframe. Using Mainmark’s proprietary technology, the engineers were able to complete the job in less than five days, achieving a maximum differential of just 6mm across the entire area of the house. 

This example clearly indicates the capabilities of modern technology and how it can completely transform the claims process both for insurance professionals and property owners.

If you would like to talk to Chris Charman at Mainmark, CLICK HEREleave a message and youTalk-insurance will pass your enquiry on.

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Insurance fraud crime and punishment – The sentences are too light

“The whole question here is: am I a monster, or a victim myself?”

Fyodor Dostoyevsky, Crime and Punishment

Tough on crime, tough on the causes of crime was a rallying call to treat the symptoms of criminal – often violent – activity that threatened a civil breakdown in society more than a decade ago. Recently released crime figures have been a sobering reminder that we have some way to go before we adequately treat the causes.

So, in this blog I want to ask two questions: “Have we forgotten about the victims?”  More precisely, I am referring to the victims of insurance fraud whose number are spiralling out of control.  The other question I want to ask is: “Why do the fraudsters do it?” and could that knowledge inform our response to understanding the causes and mitigating the threat?

Despite the increased public awareness, more modern types of insurance fraud still show no signs of abating with fraudsters inventing ever more sophisticated scams.  In 2016 the ABI reported that UK insurers detected 125,000 dishonest insurance claims valued at £1.3 billion. Undetected insurance fraud is said to cost the UK economy circa £2 billion per annum.

Whilst this figure was 5% down on the previous year, the deterrent of detection leading to a possible criminal conviction doesn’t seem to be dissuading the less conscientious members of society. That’s why I want to make a case for stiffer sentences, a campaign to turn words into action and make a case for the victims of insurance fraud.

Insurance fraud has always existed

In a galaxy far far away, or at least when I was a nipper just starting out on my insurance journey, insurance fraud occurred.  Yes, it’s not a new invention, pesky fraudsters even plied their nasty trade even back then.

An epigram by the Roman poet, Martial provides evidence the phenomenon of insurance fraud was already known in the Roman Empire during the First Century AD.

"Tongilianus, you paid two hundred for your house;

An accident too common in this city destroyed it.

You collected ten times more. Doesn't it seem, I pray,

That you set fire to your own house, Tongilianus?"
Book III, No. 52

Whilst insurers knew it was going on, the prevailing historic zeitgeist was to address it in the front room with window curtains firmly drawn.  Looking back, I can think of several instances in my early career where the fraudulent policyholder was simply told ‘this claim in fraudulent, we’re not paying it and we’re cancelling your policy ab initio'.

The fraudster policyholder would inevitably go skulking off into the sunset never to be heard of again and most importantly the insurer would have dealt with the issue without washing its dirty laundry in public for fear of adverse publicity.

So it’s nothing new.  In fact, it would be fair to say that insurance fraudsters, if my CII studies are correct (and they may not be – it was a long time ago now), played a central role in development of the concept of ‘insurable interest’, that was codified in the Life Assurance Act 1774. 

I guess it will remain a universal truth that as long as a person or a business has something that somebody else wants, criminals will be hell bent on inventing ever more devious scams aimed at snaffling stuff.    

Great to see the industry has come a long long way

I had a cold a few weeks ago which I suspected was Man-Flu, so like all good patients I took to my bed, took virtually every over the counter drug imaginable and thought I’d give day time TV a go.

First up was a programme called ‘Claimed and Shamed’ on the BBC presented by the hip swirling Ore Oduba of Strictly Come Dancing fame.  What a fascinating watch (check it out on iPlayer). 

If you haven’t seen it, Ore basically covers off a few insurance fraud detection stories that include Oscar winning performances from members of the insurance profession that inevitably culminate in pesky fraudsters being caught and justice being seen to be done (well sort of).

I say ‘well sort of’ because despite the sterling work that is being done by the Insurance Fraud Taskforce, the Insurance Fraud Enforcement Department, The ABI, insurers and BIBA, when insurance fraudsters are tracked down and prosecuted the sentences they receive seem woefully inadequate.

The court sentences are not working

Over the last year has covered numerous insurance fraud prosecution stories that point to the fact that sentences are too light. 

The sample of stories shown below sadly feature the recurring word ‘SUSPENDED’

– Man sentenced after he made 13 false insurance claims – Suspended sentence

– Man sentenced for making false insurance claims worth over £40,000 – Suspended sentence

– Woman who made false injury claim then did bungee jump on TV is sentenced – Suspended sentence

– Woman sentenced after falsely claiming her business premises had flooded – Suspended sentence

– Deed poll fraudster sentenced for making false car insurance claims – Suspended sentence

I could go on, but I think you get my point – Sentences are inadequate and not deterring criminals

The one area where there seems to be a glimmer of light relates to ‘crash for cash’.  My ‘bar room lawyer’ assessment is that this might be due to the fact that in such cases the criminals involved are putting lives and limbs are risk in their pursuit of a pecuniary gain but even here not enough is being done.

Organised gangs are staging car crashes to commit insurance fraud. As part of a national scam worth roughly £340m a year, criminals are orchestrating accidents to make fraudulent insurance claims, the profits of which are used to fund other crimes, including illegal firearms and drug smuggling. As honest policyholders we pick up a collective bill for fraud through increased premiums. 

Fraud Hotspots

It is estimated that a staggering one in seven personal injury claims are linked to crash for cash frauds, and that figure could be the tip of the iceberg. An analysis of crime statistics reveals there are also problem hotspots in certain parts of the country. Birmingham is at the top of the list, with six of the top 10 postcodes that have been linked with the crime. Bradford is another troubled area with postcodes on the list, as well as Bolton. Other places that appear on an enlarged 20-strong hotspots list include Halifax, Manchester, Enfield, Ilford, London and Liverpool.

According to the ABI these scams have already had fatal consequences.

A 34-year-old woman was killed after she was struck by a van moments after being involved in a deliberate collision orchestrated by a gang. The men responsible for the crash were each jailed for 10 years. Even so, a depressing 8% of people would still consider taking part in a crash for cash scam in order to gain financially, according to shocking statistics published by the Insurance Fraud Bureau.

The compensation culture we have is being blamed for the rising tide of fraudulent claims. Insurance giant Aviva examined its own data on whiplash and found that 94% of all personal injury motor claims it had paid were for minor injuries such as short-term whiplash. In France, this figure is estimated to be around 3%.

Hang ‘em High?

Without sounding like a ‘Hang ‘em high Judge’, I think it’s about time our legislators and politicians grabbed hold of this issue and perhaps in doing so make reference to the Sentencing Council’s guidelines for the crime of theft.

The subject of appropriate sentencing for insurance fraud does not need an existential Dostoyevsky-esque driven philosophical debate. The facts are quite simple and plain to see. With 125,000 dishonest insurance claims the issue has reached epidemic proportions and notwithstanding the great work being done to address the issue the obvious chink in the whole process is sentencing. Let’s send more insurance fraudsters to jail and publicise the fact.  

The underlying issue is more nuanced, however, than sentencing and as always it comes down to changing attitudes and education, addressing the causes. We send police officers, ex cons and victims of accidents into schools to talk about crime prevention so why not do the same for insurance fraud victims?  If eight percent of people would consider taking part in a crash for cash what does that say about our society. Let’s say that the average person has an extended family and circle of friends of around 30 to 40 people. You do the maths…

This is a problem that goes way beyond insurance. As an industry and society we have to do our best to make sure that crime doesn’t pay, that punishment is just, and above and beyond that we need to address the causes, the fraudsters’ motives.


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Don’t Keep up with the Kardashians’ – Social Media – Don’t make it easy for thieves

The omni-present Kardashian family are well known for being relentless trend-setters; however the aggravated robbery of Kim Kardashian last October was one trend we would rather not keep up with.

Unfortunately, the scary fact is that this high profile robbery does reflect something we’ve witnessed here at Covéa Insurance. In the past five years I’ve seen significant increase in the number of aggravated burglaries, particularly of HNW properties, which can leave customers severely traumatised and suffering from physical injury. 

As with the Kardashian ‘Kase’, social media is known to play a large part in the increase in these types of claim, and this trend is likely to continue as we live more of our lives online.  This week, as the clocks go back and the evenings draw in, the risk of falling victim to burglary only increases so I wanted to share some simple practical advice on how to increase your own personal safety, particularly if, like America’s ‘other’ first family, you spend a lot of time on social media.

We’re used to sharing so many aspects of our lives on social media; photos of our houses, gardens, expensive new purchases and holidays are splashed all over Facebook, Twitter and Instagram, but we rarely think about how this information could be used against us. All it takes is for the wrong person to see a picture of your fancy new car, combined with some geographical clues from the geo-tagging function of an app and they can work out where you live, and more worryingly, whether you might be at home, based on where you’ve tagged yourself.

Our behaviour on social media can make a huge difference to the risk of being targeted and I’d offer customers the following advice:

Regularly review and check your privacy settings, Facebook’s privacy settings can be confusing but it’s worth taking the time to understand them to ensure that only people you trust can view your pictures.  Twitter and Instagram are much easier to control, you can make your profile private, meaning that only people you’ve approved to follow you can see what you post.

Avoid the urge to ‘tag’ yourself when you’re out of the house for any length of time, particularly if you’re going on holiday, it’s a clear signal to burglars that your house is vacant. 

Avoid posting pictures of expensive items such as watches or jewels, these visible displays of wealth can make customers a target both within and outside their homes – this is especially pertinent with Christmas around the corner, be careful about showing off your expensive presents on social media and bear in mind that the packages you leave out for recycling on Boxing Day give passersby a window into the valuable new items that are sitting in your living room.

We know that high net worth customers are more likely to be victim of such attacks, so we have a number of covers in place on our Executive Home and Executive Plus products that provide additional protection and reassurance to customers’ which include:

  • Private counselling
  • Cover for necessary security improvements to the home after an incident or assistance on the cost of fees for moving home if the customer decides they can no longer stay in the property
  • Cover for alternative accommodation following the incident if necessary
  • Cover for ransom demands
  • A dedicated Executive Claims Manager like myself who will look after the customer from the first phone call to the last.

Thankfully aggravated burglaries are still rare, but it’s always worth ensuring that we’re minimising the risk as much as possible, after all; Keeping up with the Kardashians is just a TV show, not an aspiration!


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Steve Godbold, External Claim Operations Manager for Covéa Insurance shares some useful advice for insurance policyholders about the pitfalls of using social media and how providing too much personal information can make it easier for thieves


Future-proofing household insurance claims service

Against a constantly changing claims landscape, insurers must offer services that meet their customers' needs and expectations. As a result, and following an extensive review, Allianz is proposing to combine its commercial and household claims units to create one property claims team in Milton Keynes.

Our review showed there were clear strengths and opportunities in doing this, enabling our customers to benefit from a claims service that suits their requirements, whatever the future brings.

The pace of change in the claims arena certainly requires insurers to look to the future. Technology such as online claims services and claim tracking has already delivered benefits to customers and the next wave of digital solutions will take this further still.

For instance, in tomorrow's more connected world, your car could liaise with your digital personal assistant, your insurer's claims department and the local garage to arrange repairs following a crash.

Similarly, if you're living in a connected home, you, and your claims team, will know the second there's a leak or something's overheating. Forewarned, steps could then be taken to avoid further damage and cost.

Alongside the arrival of smarter technology, customers' expectations are also evolving. They appreciate the slick customer service delivered by the likes of Amazon and Apple, and they now expect it from more traditional companies.

As well as the delays to the proposed whiplash reforms, the review to the discount rate continues to rumble on and, with the political landscape also unsteady, who knows what Brexit may bring. Add to this a hung Parliament and you have all the ingredients for an uncertain future!

Given all these factors, insurers must continually evolve to ensure they deliver the service and propositions that are right for their customers. Co-locating our commercial and household claims teams in Milton Keynes is a good example of this.

Strong synergies between the customer journey, systems and supply chain for SME and individual property claims means it makes sense to bring the two teams together. Having them in the same location enables us to fully align our processes and procedures and deliver a single, robust customer journey.

Milton Keynes is also home to our casualty claims team. As our customers often purchase property and casualty insurance together, it's logical to have the claims operations in the same place. Where a customer’s requirements overlap, within the two areas, it can be dealt with efficiently and in a seamless manner.

Developing claims services that exceed customer expectations is essential in today's increasingly competitive and constantly changing market. The proposal to bring our property claims teams together will ensure we maintain our reputation for excellent claims service well into the future.

If you would like to get in contact with Graham Gibson about the issues raised in this blog Click Here




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Allianz insurance head of claims Graham Gibson explains Allianz's proposed review to combine its commercial and household insurance claims units to create one property claims team based in Milton Keynes.


The Loss Experience

I remember sitting next to the head of a major broking house not that long ago and we were discussing how surprising it was that the Gulf of Mexico hadn’t experienced a major hurricane since 2008, which then led onto a discussion of the frequency of major claims.

The line that really stood out for me was: “there will always be unexpected claims”. As if to prove his point, only a few weeks later the (re)insurance market was hit by the decidedly unexpected super storm Sandy, one of the latest forming major US storms to cause substantive damage in recent memory.

I’m writing about this because in recent days here in the UK market we’ve once again been given a terrible reminder of just how unexpected some claims can be. The shocking crash of a police helicopter into a popular Glasgow pub on 29 November, late on a Friday night, must register in anyone’s mind as a galling tragedy and our thoughts and prayers are with all those affected by such a peculiar disaster.

Two days later we had another costly reminder of unexpected claims with the train crash in the Bronx area of New York in which four people were killed and more than 60 injured. The 5:54 from Poughkeepsie to Grand Central Station derailed as it went into a bend in the railway line near Spuyten Duyvil station.

One is never immune to the human cost of such tragedies, of course, but as a market, whether broker, underwriter or claims professional, we have to learn to expect for and model such non-standard risks, whether they come from the aviation, rail or other specialised markets. At Russell this is very much our space, operating outside of traditional risk management boundaries and taking the best from modern risk modeling techniques.

The Glasgow helicopter crash here and the New York railway crash are brutal and costly reminders that as a wider (re)insurance market we need to continue to think outside of standard claims.

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Suki Basi, Managing Director, Russell Group – Guest blog on youTalk-insurance – The Loss Experience


Deferred prosecution agreements – Directors being hung out to dry?

Deferred Prosecution Agreements ("DPA") have been used in the United States for many years.  DPAs allow companies to take certain steps (either by way of reparation or ensuring that certain offences are not repeated) during a supervisory period and the trade off is that the company and/or the directors will not be prosecuted.  Following the expiry of this period no further action is taken.  DPAs are now to be found in UK law in Schedule 17 of the Crime and Courts Act 2013 ("CCA 2013"), although as of this date this Schedule is still not yet in force.

DPA's envisages either the Director of Public Prosecutions or the Serious Fraud Office taking action against corporate bodies and in doing so will consider (amongst other matters) the following:

  • The nature and seriousness of the offence
  • The breadth of the wrongdoing
  • The seniority of the individuals involved in the wrongdoing
  • Any losses to third parties

Unlike in the United States, the judicial authorities will have oversight of the procedure and will therefore be required to review and approve any such "deals".

So, what does this mean for directors and officers?  In the United States directors and officers are included in a DPA. In the UK directors and officers cannot be part of a DPA. 

Therefore, it is conceivable that a company will plead guilty to various misdemeanours and be required to take restorative/reparatory steps, but that directors and officers will not receive the benefit of these concessions.  Thus, directors and officers may well be placed in an invidious position whereby a company pleads guilty to certain offences (some of which may be caught by the Financial Services and Markets Act 2000) and not receive the benefit of any DPA and yet may be prosecuted on the basis of the company's plea. 

Directors and officers would face an uphill struggle when seeking to show that they are not guilty of the offences to which the company had pleaded guilty.  And another possibility – whilst the directors may be the controlling minds of the company, if they fail to enter into a DPA (which might benefit the company) then might the shareholders have a view as to the benefit of a DPA?

Whilst the suggestion is that there will be approximately 10 DPAs entered into per annum (it is not clear where this figure comes from), nevertheless the potential liabilities for directors and officers would appear to be significantly exacerbated.


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Never Mind The ‘Elf and Safety', It’s the brand, stupid!

What recent parliamentary Act has “the potential to be the most significant piece of legislation for health and safety law in 40 years”?

In an article I recently read by Helen Grimberg of law firm Berrymans Lace Mawer, it’s the recently adopted Enterprise and Regulatory Reform Act 2013.

According to Grimberg, the act “Once implemented, it will allow for the removal of strict liability, in civil claims, for breaches of certain health and saftey regulations”

In terms of what the Act means for businesses, the Department for Business Innovation and Skills (DBIS) claims it will “cut the costs of doing business in Britain, boosting consumer and business confidence and helping the private sector create jobs.”  Various elements of the Act, such as employment tribunals and reducing red tape, are designed to help UK business and support them directly.

Bureaucratic guff?  Actually, I believe the intention is to help businesses by limiting the right to claim for compensation where it can be proved an employer has acted negligently.

This means in future, if a claim is made, the employer will have the opportunity to defend themselves on the basis of having taken reasonable steps to reduce the risk of an accident – or in the words of DBIS “providing this reassurance will help businesses have the confidence to focus on managing health and safety risks in a sensible and proportionate way.”

From a claims perspective it is still too early to say what impact this change might have on the number and the success rate of claims that defendants may face but one consequence is clear: there will likely be more work in claims handling than at present. 

Let’s not become carried away here. I would be surprised if risk management teams in the UK’s business community fundamentally change their approach to health and safety and risk prevention. While breaches of health and safety are a favourite cause of mirth for comedians entertaining crowds on the stand up comedy circuit, they are no laughing matter for CEO’s and FD’s who are obligated to protect their businesses reputations and brands, as well as their employees’ safety.

In today’s world of 24/7 instant online media reporting, a breach of health and safety involving injuries or fatalities could cause irreparable damage to a company’s balance sheet if the incident is reported and goes viral. As the excellent Airmic research document “Roads to Ruin” makes clear, a decisive shortcoming highlighted in the report was “inadequate leadership on ethos and culture”. The report and its follow-up sister document, “Roads to Resilience” also identified blindness to risk to reputation as weaknesses.

In short: preventing accidents at work is not just the right thing to do in terms of saving lives but from a hard headed business point of view it might also just save your business. And that’s no joke.

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