The concept of life insurance was well developed in the eighteenth century with the establishment of The Society for Equitable Assurances (1762). Since that time the numbers of people who have tried to fiddle the insurance companies must be legion. However, some well publicised recent cases suggest that it really isn’t worth it.

Initially it seemed like the kind of story designed to whet the festive appetite for heart warming fare. Then increasingly it looked like a stunningly bold (and ill executed) stab at life insurance fraud. When John Darwin reappeared just before Christmas five years after his supposed demise in a canoeing accident he claimed he could not remember anything.

In the media, his wife expressed her relief at this turn of events and that looked to be the happy (if mysterious) conclusion to the matter. However, things got complicated when a photograph emerged of the couple together two years after Darwin’s death. The photo showed them smiling broadly in an apartment in Panama (the estate agent was also in the shot). The place was purchased with proceeds from Mr Darwin’s life insurance policy. After her complicity was brought to light Mrs Darwin was quickly arrested.

However, the police themselves emerged from the affair with little credit. Scarcely a year had gone by and the police declared there were no suspicious circumstances connected with the “death”. This conclusion was the basis for the life insurance provider to pay out. However, normally the police would only declare a missing person dead after an absence of seven years. This oversight allowed the Darwins to progress the deception quicker than they might have expected.

Subsequently, and in part due to all the publicity generated by this case, life insurance providers have tightened up their anti-fraud procedures. This can give the customer peace of mind. There is really a lot to recommend life insurance for those looking to secure the financial futures of loved ones (or business partners) in the event of their death. Insurance pay outs can be designed to redeem outstanding home loans, replace a lost source of income, cover childcare expenses and, needless to say, the cost of a funeral. Seen this way, the real benefits of the policy do justify the burden of the monthly premium.


10.4.08