The Insurance Council this week launched an Insurance Fraud Bureau, through which insurers will work together to push anti-fraud messages, receive allegations of fraud and analyse data. 

They said fraud was adding about 10% to New Zealand’s general insurance premiums and was too widely accepted by the public as a way to "get what they were owed" by the insurer.

Naomi Ballantyne, managing director of Partners Life, said there were not the same issues with personal insurance.

Most problems in that part of the market were related to non-disclosure, she said, and insurance having been offered on terms that proved to be incorrect once additional information was obtained.

Fraud that involved claiming that something had happened when it had not was very rare, she said.

"With a lot of non-disclosure, you could argue it's not so much the person wanted to defraud the insurer as they didn't think it was important.

"It doesn't change the fact it's material, but we tend not to say 'it's your fault' just that 'we've found this and we should have known about it and as a result we have to put you back to where you would have been if you had told us'. 

"It's different to saying your car's been stolen and then it turns up in your best friend's garage."

Sometimes insurers would deal with people who said they were disabled when they were not, or who claimed to be unable to work when they still could, she said.

But it was rare for a client to be a repeat offender, which is what the fraud bureau wants to tackle.

Newpark chief executive Melanie Purdey said she, too, was unconvinced it was necessary.

“A fraudulent claim in the trauma, income or TPD space would require the co-operation of a number of external third parties – such as GPs, specialists … to be successful and I'd be hard pressed to think they would put their professional reputations on the line to support such a measure. I believe the current underwriting and claim criteria checks and balances would make it extremely hard to commit fraud in a claim transaction.

“What does concern me, though, is what this kind of bureau encourages which is a social climate of mistrust of our friends and families. But that's just me. I think insurers can find a better way to manage this than by asking people to rat on each other.”