Life insurnace premiums are no longer a steal for criminals

Anyone who thinks crime pays needs to look at the latest financial tactics police are deploying against gangsters to make sure they pay more for insurance.

Detectives are squeezing the finances of organised crime gangs by sending information about the crimes and business activities to insurance firms.

Life insurance firms have a confidential hotline for police to let them know about crooks applying for cover.

The joint strategy has come about because gangsters tend to take out high value life assurance so if rivals kill them, their loved ones and families have a financial nest egg.

Insurance companies say they would not offer life cover on such advantageous terms if they knew a customer led a criminal lifestyle when applying for a policy. The insurers complain that this leads to law-abiding customers funding their payouts.

 The arrangement means crooks applying for life insurance have to pay out a massive premium to gain from the system.

 Police and insurers share information on gangsters

Strathclyde Assistant Chief Constable George Hamilton said: “We share information with several insurance companies so they understand the risk they take on when providing life assurance to criminals.

“If a criminal has heavy life assurance then it doesn’t seem right that the rest of us have to pay for that.”

Sharing information also extends to car insurance and firms fronting illegal activities.

Insurers and police already collaborate through the Insurance Fraud Bureau to track down crash-for-cash gangs in a two-pronged assault – one to put them before the courts and the other to hike their car insurance to extreme levels to counter their fraudulent claims.

The Insurance Blogger takes the view that anything police and insurers do to reduce the costs of cover for innocent customers is worthwhile, but wonders whether crooks weigh up joining a crime gang on the basis of pay, insurance and health cover benefits in the same way more ordinary employees consider joining a new firm.

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