A troubling increase in fraud cases involving manipulated photos of car crash damage is raising alarms among insurers and driving motor insurance costs to record levels in the UK.
Allianz reported a staggering 300% rise in incidents where apps were used to distort images, videos, and documents between 2021-22 and 2022-23. The insurer warned that this trend has “all the signs of becoming the latest big scam” in the insurance industry.
Zurich UK also noted a growing number of claims altered with so-called “shallowfake” technology, describing it as “one of the most emerging threats from a counter-fraud point of view.” Unlike deepfakes, which typically rely on advanced AI, shallowfakes can be created with conventional editing software and apps like Photoshop.
In one alarming case, an individual unknowingly became a victim when fraudsters used a photo of his van from social media to support a fictitious claim for an accident that never occurred. The fraudsters sent fake images showing damage to the vehicle, along with a phony repair invoice exceeding £1,000. The LV= fraud team discovered the doctored photo was identical to the original, except for the added fake damage.
Allianz emphasized that the evolving nature of fraud, especially with the rise of shallowfake and deepfake technologies, poses significant risks to UK consumers. Scott Clayton, head of claims fraud at Zurich UK, noted that shallowfakes are particularly prevalent in motor insurance. Fraudsters are reportedly adding fake registration numbers to salvaged vehicles, leading to claims based on these manipulated images.
“Fraudsters can now create a claim entirely from their computers, extracting substantial sums of money without needing a physical crash,” Clayton explained, highlighting a shift from traditional “crash-for-cash” schemes.
As fraud levels rise, motor insurance premiums have also surged. The Association of British Insurers reported that the average cost of comprehensive motor insurance in the UK increased by 33%—equivalent to £157—during the first quarter of this year compared to the same period in 2023.