Insurance fraud spikes whenever a new technology upgrade, such as the release of a new iPhone, occurs, says Dave Ashton, head of the Insurance Council's Insurance Claims Register.

Speaking at the council's annual conference this week, Ashton said when new technology was released, many people want to upgrade their model and therefore claimed their older models had been stolen, lost, or accidentally damaged. The ensuing insurance pay-out funded the new upgrade.

Although fraud was often the "elephant in the room" for insurers who don't want to accuse their policyholders of being dishonest, public attitudes are changing, Ashton said.

There has been an upsurge in anonymous public tip-offs online because people are angry that family members and friends are contributing to a rise in premiums for their insurance through lying about claims, he said.

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He cited a recent case where someone tipped the council off to a man selling his Rolex watch on Trade Me, having previously claimed on insurance for it being lost. Ashton said when the tip-off was investigated by the man's insurer, his defence was that he had later found the watch after the claim was paid out and was selling it because he had already bought a new one with the proceeds. "Yet he no longer owned that watch," Ashton said.

Ashton said it was hard to estimate the level of insurance fraud in New Zealand but internationally it's estimated to be between 10 and 20 percent of gross written premiums, which were $5.2 billion across the industry in New Zealand last year. Total claims paid out were $2.4 billion.

Two years ago, the industry estimated the average New Zealander was paying $120 more in insurance every year because a small percentage lied to their insurer.

The highest levels of fraud by consumers are for travel and motor insurance while for businesses it is for commercial material damage, such as intentionally setting fire to their work premises or flooding stock on the shelves. Ashton said there was always a spike in this type of fraud by business owners in an economic downturn.

Fraud falls under three main categories - organised crime such as body shop collusions on motor cars, repeat offenders who have made serial claims, sometimes for the same item, and those insured with more than one company who double-dip by making claims for the same incident with both without realising that is illegal.

The Insurance Council of New Zealand was one of the first in the world to introduce an Insurance Claims Register 15 years ago and it now keeps data on 90 percent of the country's policy applications and insurance claims. Only authorised personnel from participating companies have access to the information.

Around 8,000 claims are now flagged as being potentially fraudulent, Ashton said, but it was up to the insurance companies' fraud teams to decide whether to investigate them.

The council this week launched upgraded technology on the register which allows more 'big data' analysis, including hotspots such as the number of burglary claims in a particular neighbourhood. It can also provide predictive analysis around likely claims for things like weather events based on the collective claims history.