Luxembourg is no exception to insurance fraud, and the concrete cases of scams that occur each year clearly demonstrate this. Do you rely on the experience of your employees to identify inconsistencies and protect your business? It is a good start. But with documentary fraud techniques that are constantly being improved, this unfortunately becomes insufficient. In this article, discover how insurance fraud is expressed in practice in Luxembourg, and how you can detect it as soon as possible.
The concrete cases of insurance fraud encountered on Luxembourg territory speak for themselves. These scams all aim to circumvent the rules in order to obtain an advantage, most often financial.
In a nutshell: insurance fraud is a deliberate act intended to deceive an insurance company.
In a country like Luxembourg, where the insurance sector is heavy and based on cross-border activity, fraud is often hidden in the details:
The main principles are similar to those encountered in other European countries, and one thing is certain, vigilance alone is no longer enough.
Do you want to learn how to spot fraudsters? Start by identifying their techniques! La insurance fraud adapts, is transformed, and sometimes even hides behind certain approaches, which seem trivial.
To find it, you need to master its mechanics. But also know your preferred targets, which are in reality very common procedures.
In the insurance sector, the document fraud To a false invoice generally consists of presenting an inflated, or fictional, bill.
Example: a Luxembourg insured declares a theft of computer equipment in his offices. To expand his file, he provides a recent purchase invoice that shows artificially inflated amounts.
The aim? Receiving unwarranted compensation, or compensation that was greater than originally planned.
Social Security fraud refers to all the manoeuvres used to evade social security contributions, or to obtain them unduly.
Example: an employee who resides in Luxembourg declares a prolonged incapacity for work to the CNS (National Health Fund). She then receives sickness benefits even though she is in fact exercising an undeclared professional activity in another country.
The aim? Receiving social benefits and/or illegitimate income, at the expense of the community.
This type of fraud occurs when an insured person provides false information about a claim, which he may have caused himself.
Example: an insured declares that his vehicle was stolen in front of his home in Luxembourg. When he actually abandoned it abroad, to get rid of a model in poor condition.
The aim? Deceive the insurer in order to receive undue and early compensation.
Subscription fraud occurs as soon as the contract is signed, when the subscriber hides or voluntarily changes certain information, such as: his professional activity, his physical condition, his insurance history, etc.
Example: When taking out health insurance, an individual deliberately omits to mention his chronic illness.
The aim? Insure insurance quickly or avoid an additional premium or even a denial of coverage.
The concrete cases of insurance fraud identified in Luxembourg have a direct impact on insurance companies. Moreover, incidents are not always complex falsifications. Sometimes a single document or statement is enough to crash the system. But in some cases, the deception is quickly exposed.
In 2024, the CNS conducted its investigation into Social Security fraud. It had then detected 265 false certificates of incapacity for work, with approximately 145 insured persons involved.
The majority of the fraudulent certificates were obtained online, without any medical consultation. The contracts were quickly declared void and numerous fraudsters were amended.
Another example of insurance fraud: in 2009, a police officer tried to swindle his property insurance from Luxembourg by deliberately setting fire to her car.
He said the fire was caused by the overheating of a gas can left in the vehicle parked in direct sunlight. The defendant thus hoped to obtain 30,000 euros in compensation.
However, the investigation revealed the presence of fire accelerators and flammable objects in the passenger compartment.
In 2023, an individual amended the sales contract for his vehicle (a Renault Espace) in order to increase his selling price from 1,000 to 2,000 euros.
The aim of this auto insurance fraud ? Get higher compensation! The court found him guilty of forgery, use of forgery and attempted fraud.
Faced with these cases, one observation: it is not so much the isolated fraud that is dangerous, but rather its repetition. When an actor in the insurance sector acts, at its level, to prevent “slight” falsifications, it also fights against excesses.
If concrete cases of insurance fraud persist in Luxembourg, it is because some loopholes remain open, and therefore exploitable.
On the one hand, fraudsters know how to be creative. They spot blind spots, discreetly alter documents, and take advantage of the just-in-time flow that prevents systematic checks.
On the other hand, Luxembourg insurers manage large volumes of cases, sometimes with limited resources. Compliance and anti-fraud teams cannot detect all falsifications, especially when they are finely executed.
Some scams fall through the cracks, and it's only natural:
Integrated at the right time, and in the right way, certain technologies nevertheless make it possible to overcome these difficulties.
Supporting documents are increasingly easy to handle, and Luxembourg insurance companies must make a decision, and quickly. Human vigilance is not always enough.
So, companies concerned about the quality of their controls are strengthening their anti-fraud policy and are equipped with software solutions for the detection of false documents.
This is exactly what Finovox offers, an easy-to-use detection tool that:
With its API version or its SaaS platform, you gain in reactivity, without sacrificing the reliability of your controls. And when it comes to insurance, Finovox intervenes as soon as you need it: at the time of subscription, but also in the event of compensation.
