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JOHANNESBURG. — Mortuary workers selling corpses and fake job scams to get ID numbers are among the criminal ways South Africans are trying to score from funeral policies.
The Association for Savings and Investment SA (Asisa) said yesterday the country’s life insurers reported a 12 percent increase in fraudulent and dishonest claims across all lines of risk business in 2020 when compared to 2019.
This spans a range of claims including for death, disability, funeral and retrenchment.
Last year 3 186 cases of fraudulent and dishonest claims to a value of R587m were recorded, compared to 2 837 fraudulent and dishonest claims in 2019 valued at R537m.
The highest incidence of fraud and dishonesty last year took place in the funeral insurance space, where a total of 2 282 claims were found to be fraudulent or dishonest.
Commenting on the statistics, Megan Govender, convener of the Asisa forensics standing committee, said the increase in fraudulent and dishonest claims is not surprising since tough economic conditions make it more tempting for dishonest policyholders and syndicates to try their luck in the hope of scoring sizeable insurance payouts.
Govender said while funeral insurance has always been seen as a soft target by fraudsters, the Covid-19 pandemic has made it worse.
He said desperation due to job losses is driving more people to resort to crime while the pandemic has also resulted in a significant increase in deaths, which makes it easier to source dead bodies from flooded mortuaries for fraudulent claims.
“Since funeral insurance policies do not require blood tests and medical examinations and are designed to pay out quickly and without hassle, when an insured family member dies, criminals and dishonest individuals most commonly try their luck in this space,” she said.
Of the crooked claims detected, most were in KwaZulu-Natal (31 percent), followed by the Eastern Cape with 16 percent and Gauteng with 15 percent.
Govender said there have been several shocking incidents in recent months that illustrate how far some people will go to illegally access a funeral policy payout.
Govender said fraud in the funeral insurance space often involves mortuary employees who sell bodies to syndicates who then use the bodies to claim against policies fraudulently taken out some months earlier.“ — Sowetanlive.
Online Reporter