{
  "id": 11789227,
  "title": "Motor insurance fraud on the rise",
  "url": "https://urgent.news/2026/10/03/motor-insurance-fraud-on-the-rise",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-03T23:10:27.000Z",
  "source": {
    "name": "New Straits Times",
    "slug": "new-straits-times",
    "url": "https://www.nst.com.my/news/nst-special/2026/10/1547056/motor-insurance-fraud-rise"
  },
  "original_language": "en",
  "account": "Motor insurance fraud cases in Malaysia have increased substantially over the past three years, according to the General Insurance Association of Malaysia (PIAM) chief executive officer, Chua Kim Soon. The surge in fraudulent activities is attributed to sophisticated syndicate tactics, opportunistic financial schemes, and the misuse of digital image manipulation tools to manipulate insurance claims. PIAM reported an underwriting loss of RM289.3 million last year, with 10 percent of all motor insurance claims potentially fraudulent or manipulated, leading to financial losses of hundreds of millions of ringgit for insurance companies.\n\nThe number of reported fraudulent cases has risen, from 425 in 2024 to 924 in 2023. These fraudulent scenarios include individual vehicle owners exaggerating repair damage, swapping driver identities, and highly organized criminal schemes involving staged multi-vehicle collisions and fake total-loss payouts. Additionally, unauthorised or unlicensed drivers, private vehicles being used for commercial hire, and driving under the influence are becoming common issues for insurers. While policyholders are ultimately responsible for the financial burden of these fraudulent claims, insurance companies must adjust overall premium rates to absorb the deficit.\n\nPeninsular Malaysia records a significantly higher claim frequency of 5.1 percent, compared to 1.7 percent in Sabah and Sarawak. However, the claims in Sabah and Sarawak tend to be costlier, averaging RM12,000. Repair costs for motor vehicles are also increasing, particularly for imported spare parts used in foreign and high-end vehicle models, with motor repair costs growing at a compound annual rate of 7.9 percent between 2021 and 2025. Average personal injury compensation has been trending upward, with major bodily injury awards now often exceeding RM1 million.\n\nTo combat fraud, insurers cross-check through the Fraud Intelligence System and investigations by loss adjusters, using engine and chassis numbers and weather data to authenticate claims. Cases involving suspected criminal syndicates are escalated to the police.",
  "summary": "KUALA LUMPUR: Motor insurance fraud cases have surged dramatically over the past three years, driven by evolving syndicate tactics, opportunistic financial schemes and the misuse of digital image manipulation tools to exploit claims processes.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}