While it may seem harmless at first glance, insurance fraud has many serious consequences, especially when it involves staged accidents. For insurers, it has been an uphill battle, but recent technological advances have made committing insurance fraud drastically harder. 

We’ve gathered all the most important and recent insurance fraud statistics and are presenting an overview of what the industry looks like in 2022.

Insurance Scam Stats - Editor’s Pick

  • Insurance fraud causes $308.6 billion worth of damage to consumers in the US.
  • 78% of American citizens worry about insurance fraud.
  • The insurance industry comprises 7,000 organizations in the US alone.
  • Insurance scams cause $29 billion of damage to auto insurers annually.
  • Roughly 85% of insurers have dedicated investigation teams.

General Insurance Industry and Insurance Fraud Stats

Insurance fraud has been around for as long as the insurance business itself. Today it costs consumers hundreds of billions of dollars. Below, you’ll find the key insurance industry and insurance fraud data.

1. Taiwan has the highest rate of insurance penetration, 14.8%.


In the past 10 years, Taiwan’s GDP has been steadily rising; with it, insurance penetration rose significantly above the global rate of 7%. At 11.7%, the US also has a pretty high rate of total insurance penetration.

2. There are more than 7,000 insurance organizations across the US.


The massive insurance industry is growing by the day in the US, collectively bringing in more than $1 trillion in premiums annually. While the industry's sheer size is impressive, statistics on insurance fraud show that overall insurance costs have also increased.

3. In 2021, Northwestern Mutual was the largest life insurance company in the US, with $14.3 billion in direct premiums.

(National Association of Insurance Commissioners, Northwestern Mutual)

Founded 165 years ago, Northwestern Mutual offers life insurance, permanent life insurance, disability income, long-term care insurance, and other services. The insurance company had nearly $334.7 billion in total assets at the end of 2021.

According to data from the NAIC, New York Life came in second on the list of top insurers in America by direct insurance premiums in 2021, of $13.3 billion.

4. Insurance fraud costs American consumers $308.6 billion every year.

(Coalition Against Insurance Fraud)

The cost of insurance fraud keeps growing. Once insurance fraud happens, it doesn’t only hurt the insurance company but can also affect ordinary consumers. In fact, according to the Coalition Against Insurance Fraud, Americans suffer billions of dollars of damage caused by insurance fraud.

5. In 2021, UK insurance companies registered 89,000 fraudulent claims.

(Association of British Insurers)

This was a decrease of 5% compared to 2020 and the lowest level registered since 2007, according to insurance scam statistics. The number of fraudulent claims is on a decline thanks to the sustained fight against insurance fraud, as per the Association of British Insurers.

6. An average detected fraudulent insurance claim in the UK in 2021 was worth £12,283.

(Association of British Insurers)

While the number of detected false claims was on a decline, the average fraudulent claim value was at its record level in 2021. In total, UK insurers discovered £1.1 billion worth of insurance fraud last year, a 2% decrease compared to 2020.

7. US insurance fraud stats reveal that, in 2021, a form of fraud was suspected in 20% of insurance claims.


That was an increase from the 18% registered in a survey conducted two years earlier. Fraud accounted for around 10% of all claims costs, according to the insurance companies and insurance professionals surveyed by FRISS.

False injury claims, nondisclosure of relevant information, and staged accidents were the key insurance fraud schemes in 2021.

8. 59% of insurance industry respondents said they expect to improve the loss ratio thanks to fraud detection software.


The COVID-19 pandemic boosted digitalization in the insurance sector, giving the industry better tools to combat fraud throughout the policy lifecycle, as confirmed by the latest insurance fraud statistics. According to FRISS, 53% of the 400 global insurance professionals who participated in its survey expect anti-fraud technology to help them stay ahead of developing fraud schemes, with 52% anticipating improved investigator efficiency.

9. 78% of Americans say they’re concerned about insurance fraud.

(Coalition Against Insurance Fraud)

Americans have long been aware of the damage caused by insurance fraud, but in recent years they’ve been showing an increased level of tolerance toward it, according to data from the Coalition Against Insurance Fraud.

Insurance scamming statistics reveal that over the 1997-2007 decade, the share of those who believe it would be unethical to misrepresent the nature of an incident to get payment for a loss not covered fell from 93% to 87%. Likewise, the number of respondents who are of the opinion that inflating an insurance claim is unethical fell from 91% to 84%.

10. Insurance fraud costs an average US family between $400 and $700 a year in the form of increased premiums.

(Allied Market Research)

Data from the Federal Bureau of Investigation shows that the total cost of non-health insurance fraud is estimated at over $40 billion annually. 

Some of the most common fraud schemes include premium diversion (premium embezzlement, generally by insurance agents); fee churning (intermediaries taking commissions through reinsurance agreements); asset diversion (theft of insurance company assets); and workers’ compensation fraud (when companies misappropriate premium funds without providing insurance).

11. The global identity theft insurance market was worth around $570 million in 2020.

(Allied Market Research)

The size of the identity theft insurance market is projected to grow to $2.09 billion by 2030, expanding at a CAGR of 14.2%. The top players in this insurance segment include Allstate, Aura, Chubb, Experian, and GEICO.

Relevant fraud statistics show that the most commonly reported types of identity theft include credit card fraud, insurance fraud, and online shopping and payment account fraud.

Health Insurance Fraud Statistics

Financial fraud comes in all shapes and forms, whereas insurance organizations in the health care sector are among the prime targets. Unfortunately, this can lead to more complicated procedures for all insureds, including those with legitimate claims. Here you’ll find the most revealing statistics that pertain to the sector.

12. The value of false health insurance claims in 2020 amounted to $3.1 billion.

(Coalition Against Insurance Fraud)

Health care fraud in the US isn’t as rare as one may be led to believe. However, various corrective actions have been taken, and the rate of insurance fraud in the health care system has decreased as a result.

13. Only 1% to 3% of life insurance claims are investigated for fraud or outright denied when first filed.


The number of fraudulent claims might initially seem low, but life insurance statistics reveal that as the contestability period (during which the insurance company can review and contest an insurance claim) draws to a close (usually after two years), the number of revoked claims drastically rises. It is during this time when roughly 20% of all life insurance claims are found to be fraudulent.

14. During the 2020 fiscal year, improper Medicare payments (FFS, Part C, and D combined) were worth $42.9 billion in total.

(Centers for Medicare & Medicaid Services)

Medicare fraud rates are steadily declining, at least according to the latest Medicare fraud statistics. In FY 2019, the total value of improper Medicare FFS payments was $28.9 billion, or 7.25%. Within a year, that percentage dropped to 6.27% (a value of $25.7 in 2020), mostly thanks to reduced home health care fraud.

15. Improper Medicaid payments totaled $86.5 billion during the fiscal year of 2020.

(Centers for Medicare & Medicaid Services)

Medicaid saw a considerable spike in irregularities, resulting in 21.4% of all payments being improper in one way or another during 2020. Medicaid fraud statistics for FY 2019 show that improper payments that year accounted for $57.4 billion, or 14.9% of all Medicaid payments.

16. From 2016 to 2020, improper payments for home health declined by roughly $5.9 billion.

(Centers for Medicare & Medicaid Services)

Thanks to policy clarifications and the Targeted Probe and Educate program, home health saw a steady decline in fraudulent and improper payments over the five-year period. Likewise, skilled nursing facilities saw a decline in improper payments by $1 billion from 2019 to 2020.

Auto Insurance Fraud Statistics

Auto insurance premiums are rising, but so is auto insurance fraud. From auto glass claims spiking in Arizona to intentionally set car fires, we bring you the stats for this segment of the insurance industry.

17. Insurance scams cause at least $29 billion in damage to auto insurers annually.

(Insurance Information Institute)

Staged crashes, false or overblown reports, and faking information are just some of the instances where harm is caused to insurers. As such, they can be extremely dangerous. 

The most extensive damage, $10.3 billion a year, is caused by unrecognized drivers. Underestimated mileage leads to $5.4 billion in fraud, while accident insurance fraud statistics reveal that violations/accidents result in $3.4 billion in fraudulent claims.

Additionally, stats show that as much as 14% of all personal auto insurance premiums can be attributed to the cost of covering premium leakage.

18. There were 8,898 intentionally started car fires in the US in 2020, according to auto insurance fraud stats.

(Coalition Against Insurance Fraud, Statista)

That entire year, there were 39,851 arson offenses in the US, 15,079 of which were fires set to structures.

19. 10% of all US auto glass claims were registered in Arizona between 2015 and 2019.

(Coalition Against Insurance Fraud)

This stat is all the more interesting because more auto glass claims are filed in Arizona than in Texas or California, whose populations are four times and 5.5 times bigger, respectively. Over the five-year period, auto glass claims jumped 26%, suggesting a potential increase in fraud.

20. In the UK, motor vehicle insurance scams are the most common type of insurance fraud, causing £577 million in damages in 2021.

(Association of British Insurers)

Year after year, property insurance fraud statistics show that scams involving motor vehicles contribute the most toward the total insurance fraud amount in the UK. The value of motor insurance claim frauds inched down 1% in 2021 compared to 2020, though their overall number decreased by 7% to 49,000.

21. An average American family spends around $1,575 on car insurance every year.


Owning a car has become more costly for an average American household. Insurance costs per unit in 2020 were higher than in 2019, when they stood at $1,545, and particularly 2018, when the costs were around $976. This speaks to the fact that auto insurance premiums have increased significantly in recent years.

Insurance Anti-Fraud Statistics

Did you know that the majority of insurance companies have fraud investigation teams? You’ll find more about this and other telling anti-fraud statistics in the section below.

22. Of all US states, only Oregon has no insurance fraud laws.

(Coalition Against Insurance Fraud)

In 48 states, insurance fraud is defined as a specific crime, while 30 states have insurer fraud defined as a specific insurance crime. Currently, eight US states don’t have dedicated insurance fraud bureaus.

23. 85% of insurance companies have appointed a fraud investigation team.


These days, insurers are compelled to appoint whole teams to combat rising health care and other fraud. According to statistics, at every insurance company, an average of seven employees are engaged in the task of investigating fraudulent claims.

24. Only 10% of insurers use algorithms to flag suspicious claims.


Modernization and machine learning are still not widely used in the insurance industry. There are, however, promising plans for building models that’ll help detect fraud and lower costs.

25. 21% of insurers plan to implement AI fraud detection in the next 24 months.

(Coalition Against Insurance Fraud)

Artificial intelligence makes it easier for companies to detect and even prevent fraud. However, insurance fraud statistics indicate that only 4.3% of health care firms use AI. All of them belong to the category of large enterprises, with annual revenues that surpass $500 million.

Relevant cybersecurity statistics show that more than 40% of privacy compliance technology will have employed AI by 2023

26. The risk of insurance fraud limits the product offering for 87.5% of insurers.


Every single insurance organization surveyed by RGA confirmed it was concerned about potential fraud. For most, that risk also translated into an inability to innovate, leading to reduced earning potential for insurance companies and higher insurance premiums for their clients.

27. The insurance fraud detection industry is expected to grow at a CAGR of 17.4% between 2021 and 2026.

(Mordor Intelligence)

As the number of insurance fraud cases rises, so does the quantity of countermeasures. The industry of fraud detection and prevention is on a path of steady growth, with North America currently being the largest market for this technology. Experts believe Asia-Pacific is the region that’ll mark the most significant growth in this field during the 2021-2026 period.

The Bottom Line

It’s evident that insurance fraud hurts a lot of people, not just big corporations. As we’ve seen from the above statistics about fraud complaints and especially about car insurance fraud, the dangers of evading paying insurance premiums, or worse, staging accidents to collect insurance payouts aren’t just monetary. 

The insurance industry is adapting, though, and within the next five years, we can expect to see a decline in at least some forms of fraud.