Conviction for insurance fraud "exaggerate injuries&quo

 
woman who exaggerated her injuries after a car crash to gain further compensation has been fined £2,500.

Mr Justice Coulson found Joanne Kirk, of Preston, to be in contempt of court for inflating a claim of damages for personal injury.

This judgement is the first time that an insurer has obtained a conviction under these circumstances – and the company NIB, which forms part of Royal Bank of Scotland (RBS), is hoping it will send out a message that could help to reduce car insurance costs.

In the initial case, Ms Kirk made claims she was severely disabled, and compensation was awarded to cover for the condition of fibromyalgia worth £800,000.

However, an investigation from NIB led to her being filmed secretly whilst being more active.

Mr Coulson's ruled she "exaggerated her symptoms to a significant and unconscionable degree" and can have had no "honest belief" that much of her claim was true, after claims following an accident in 2001.

He added the videos of her driving, shopping and walking demonstrated a "huge gulf between Mrs Kirk’s verified statements and the reality of her condition".

Kate Lotts, RBS Insurance director of specialist claims, said: "We saw an opportunity to enhance the counter fraud measures available to all insurers by pursuing this case.

"Significantly, this landmark decision gives insurers a means to pursue not just their own policyholders, but also fraudulent third parties."

She added: "Anyone considering committing fraud, whether they be our policyholders or third parties, will now have to face very serious consequences beyond the main personal injury action for dishonestly inflating a claim."

Ms Lotts concluded any measures which make fraud less attractive to fraudsters is good news for policyholders, who currently pay some £40 each per policy to cover the cost of fraud.

In the case, Ms Kirk was fined £2,500 and ordered to pay a half of the insurer's costs for the contempt case - leaving her with a bill around £125,000.

Jo Pizzala, partner at law firm Plexus Law which advised NIB in the case, said: "There is no doubt the costs consequences of this action have been severe to Mrs Kirk.

"As well as recovering no money from the original claim due to adverse costs orders her legal expenses cover was withdrawn and those costs and the subsequent costs of her defending the contempt proceedings are approximately £125,000 on top of this there is an order for recovery of 50 per cent of the applicants contempt costs.

"This will severely impact upon her financial position for many years to come."