Kathmandu. Global insurance fraud losses are expected to exceed $80 billion in 2025.
According to Coinal’s ‘Insurance Fraud Statistics 2025: Exposing Major Losses’, global insurance fraud is estimated to exceed $ 80 billion annually. “Industry-wide suspicious insurance payments are generally estimated to be close to 2 per cent to 10 per cent depending on business and jurisdiction as insurance fraud rates approach 10 per cent in some areas,” the report said.
Fraud claims in the Asia-Pacific region increased by 22% year-on-year in 2023. Which is increasing due to fake accidents and increased claims.
Globally, auto insurance fraud surged by 19% in 2023. Which highlights the sector’s risks for organized networks that carry out fake accidents for payments.
Life insurance is one of the most affected categories. Its losses worldwide are close to $ 75 billion annually.
Property and damage fraud accounts for about 10 percent of the total loss of the industry. That’s about $122 billion annually.
Collectively, the loss of life and property worldwide is more than $300 billion. Which is growing at a rate of more than 10 percent per year.
Technology is playing a central role in combating these risks. Predictive modeling, AI and automated red-flag systems are now widely used. The global fraud detection insurance market is projected to grow from $7.5 billion in 2024 to $9.05 billion in 2025 and $22.9 billion by 2029.
Insurance companies using AI devices are seeing a decrease of 20 percent to 40 percent fraud, depending on the type of case. Emerging threats such as deepfake impersonation, synthetic identity fraud and voice-based scams are increasing risks in many markets.
Insurance companies have also reported an increase in fake property damage claims. In 2023, drones helped detect fraudulent activity worth nearly $1 billion.
While progress has been made in detecting insurance fraud, fraud continues to increase costs and slow claim processing globally.
