Frauds come in a number of different shapes and sizes and they don't fall in a single box or category, according to the chair of Insurance Fraud Taskforce.
David Hertzell went on to say it was important to understand the variety of types of people who commit fraud "because counter measures are going to match people who were doing it."
Speaking at a conference on general insurance in the UK, organised by the Westminster Business Forum, Hertzell outlined three different types of fraudsters: organised criminals; opportunistic but pre-meditated individuals who are not involved in professional gangs but commit fraud with some planning; and those labeled "spur of the moment", which means these individuals commit crimes without planning.
"So what works with the organised criminal fraud is less effective in dealing with opportunistic fraud," he said.
Hertzell said the latter was "probably one of the most difficult areas to deal with" because it was very hard to detect.
He stated lack of customer education could add pressure to insurers, adding: "Policy holders don't have a clue what they are buying. We all understand what an excess is, most people don't. People buy a product they don't really understand. When it comes to making a claim and it doesn't turn out quite as they expect."
He said customers would then put themselves into a "victim mentality" and immediately put their retaliations first.
There is also a perception of low or no penalty if they get caught. "They also feel unlikely to be caught. When it comes to opportunistic fraud, that's true. There is a perception that penalties are low. Actually they are not but nonetheless there's a perception of that."
Apart from consumer education, Hertzell stressed good use of big data, as opposed to fragmentation of databases, could help claims investigation. Commitment from senior management would also add efficiency to the industry for providing more time and resources such as investment in IT.