The Claims Management Regulator has stripped a holiday sickness claims management company of its licence after it was found to have encouraged holiday-goers to fabricate or embellish symptoms of gastric illness to get compensation.
Intelligence gathered by the Regulator revealed that Lancashire-based Allsure Ltd had also used deceptive sales scripts and exaggerated expected pay-outs in order to entice members of the public to make a claim.
Kevin Rousell head of the Claims Management Regulator said that the move showed that the watchdog is prepared to take firm action against claims businesses which engage in serious misconduct.
“Seeking to encourage false claims will not be tolerated,” he warned.
The action taken against Allsure Ltd is the latest in a series of moves by the Government to crackdown on fake sickness claims, following concerns from the travel industry of a surge in insurance claims for gastric illnesses like food poisoning being brought by British holidaymakers.
In July ministers stepped in to reduce cash incentives in bringing spurious claims against package holiday tour operators. Under these proposals tour operators would pay a prescribed sum depending on the value of the claim, making the cost of defending a claim predictable.