GAP Insurance, the new environment for fraud

Crawford Legal Services recovers £70k after identifying GAP Insurance Fraud

"Ever considered insurance policy fronting?

Policy fronting is when you take out a car insurance policy in your name, but you are not the primary driver. Here is ‘case in point’ about why it might be a good idea to think again.

Furthermore, fraudsters are opportunistic. This case serves as a warning for insurers to be alive to GAP Insurance Fraud.


”Ron” purchased a Mercedes S63 AMG for circa £125,000 in May 2019. Ron is not his real name – we’ve de-identified him for the purposes of this article. The purchase invoice included RTI (return to invoice) GAP Insurance.

Ron said he lent the car at weekends to his cousin “Mike”. On 10 June 2020, Mike reported the Mercedes was hit in the rear, in the early hours of the morning, in North London by a BMW M3.

The car was recovered to an accident management business. With no personal injury or credit hire claims submitted the RTA insurer admitted liability and paid the claim without investigation in light of the prestige vehicles involved.

As is often the case, the RTA insurer didn’t consider GAP insurance and the financial motive for fraud.

Once the £50K PAV payment was made, the £30K GAP Insurance claim was presented…

The GAP Claim & the Fraud

Crawford Legal Services (CLS) was appointed to investigate the GAP claim. Unusually for GAP Insurance fraud, the claim wasn’t at the end of the policy, however:

• The Mercedes was a prestige vehicle yet was taken to a ‘back street’ garage for repairs.

• The damage, although extensive, was largely cosmetic and the repair costs substantially exaggerated.

• The assessor who conducted the inspection was a key fraud enabler.

Both Ron and Mike cooperated with CLS (as policyholders are obliged to do). Ron was the RTA insurance policyholder but his story didn’t add up – we knew something wasn’t right.

Ron claimed to be the main user whereas Mike, who had recently set up a prestige chauffeur business, appeared in reality to have control of the car and the accident management of the claim.

Forensic engineering evidence was organised, and both cars were inspected. The S63 AMG had been recovered to a garage (a short distance from the alleged RTA location). The car was found to have circa £22K of damage, well short of the total loss threshold.

More alarmingly the accident damage was inconsistent with the alleged circumstances of the accident as reported. Furthermore it was found that some of the damage sustained to the Mercedes had been caused deliberately.

Ron was challenged as to the accident circumstances, the total loss of the vehicle, the recovery to the accident management business, his relationship with Mike and his actual use of the vehicle. Ron admitted the vehicle had been bought for the primary use of Mike and that the RTA policy in his name was fronted.


CLS was satisfied that Ron had nothing to do with the staged accident concerning the Mercedes. His downfall was foolishly agreeing to insure the vehicle in his name when it was really Mike who was to be the primary driver and custodian of the car.

Whether Mike was using the vehicle for prestige chauffeuring or other purposes is unclear. What we do know is that Mike went to ground leaving Ron liable to repay his RTA insurer including costs and expert report fees due to the fraudulent claim orchestrated by Mike.

The case highlights how the existence of a GAP policy made a staged accident so attractive for opportunist fraudsters. The S63AMG was acquired on finance with significant monthly finance payments. The RTA insurer PAV payment and the GAP top would pay off the finance with a bonus on top.

Acting for the RTA insurer under CFA, CLS has successfully recovered all monies paid out as part of this scam.

And what we do know with much certainty is that ‘policy fronting’ doesn’t pay. Quite the opposite."

For more details, contact Peter Oakes, Head of Counter Fraud at Crawford Legal Services (

21 views0 comments

Recent Posts

See All