Australian insurers are still facing a spike in the number of major fraud cases appearing before the courts, despite fraudsters increasing their focus on the investment sector, according to a KPMG study.

The Forensic Fraud Barometer report shows that although investment fraud is taking the lead, the insurance industry recorded increases in the number of cases going before the courts.

KPMG Forensics National Head Gary Gill says in the six months to June 30 there were five major insurance fraud cases worth $2 million, compared to 12 over the previous few years.

He says these cases included a $300,000 fake-death claim, plus an instance where an insurance employee set up a fake policy and made claims worth $300,000.

While overall fraud in Australia has fallen from $132 million for the first-half last year to $91 million for the first-half this year, Mr Gill says it’s difficult to pinpoint the reason for this.

He says the insurance industry is always going to be a target for fraudsters, but believes more can be done on “weeding out the bad customers before they come on board”.

“But my gut feeling with some of these big insurance companies is that they are very aware of the risks, particularly on the claims side,” Mr Gill told insuranceNEWS.com.au.

The Insurance Council of Australia’s GM Risk and Disaster Planning Karl Sullivan says the industry is already working hard to reduce the level of fraud with more than $700,000 saved in the first eight months of the new Insurance Fraud Bureau of Australia.

“From this success we believe this is only a tiny fraction of what can be saved and we hope to drive this even further,” Mr Sullivan told insuranceNEWS.com.au.