The UK insurance industry will now “name and shame” fraudsters in a bid to stop the growing £2 billion ($2.9 billion) a year wasted on bogus claims.

An industry-wide and owned database on known cheats funded by members of the Association of British Insurers (ABI) will enable insurers to identify anyone who fails to declare any previous fraudulent activity.

The database will be fully up and running by early next year following a six-month pilot program, and aims to reduce the problem that is currently adding an average £44 ($65) a year to every UK policy.

ABI Director of General Insurance and Health Nick Starling says the project demonstrates how serious the industry is in its bid to protect honest customers.

“The database will build on existing industry databases that help insurers check the previous claims history to ensure that there is no hiding place for anyone caught making a bogus or exaggerated insurance claim,” he said.

Insurance Fraud Bureau (IFB) Chairman David Neave says this is a vital next step in strengthening an already tough program to tackle fraudsters and will stand alongside the work the IFB is already doing in co-operation with insurers and police throughout the country.

“Our work has led to the prosecution of many organised insurance fraud gangs, helping save money for insurers and honest customers,” he said.