Reformulating the Criminal Offence of Insurance Claims Fraud: A Critical Analysis of English, German, and Chinese Laws

This article critically examines English, German and Chinese laws regarding insurance claims fraud and analyses the constituent elements of the fraud offence, the minimum conditions for criminal liability and the conditions for grading the punishment. English law has shifted in emphasis from the old result-based deception to the conduct-based fraud, but the intended causation by fraudulent misrepresentation to the intended result of the fraud in the context of the insurance claims has yet to be tested, this article puts forward a concept of presumption of intended causation by the establishment of materiality of misrepresentation in the light of the recent development of case law. German Criminal Code 2019 also adopts the stance of treating insurance fraud as a conduct-based offence. In contrast, Chinese Criminal Law (art.198) places unjustified emphasis on the result of fraud and punishes attempted offence significantly lighter than the consummated offence. Whether the insured can succeed in obtaining the insurance money by fraud depends on whether the insurer saw through the fraud. A high degree of moral equivalence exists between the successful insured and the unsuccessful one since both have done everything in their power to bring about the fraud offence. It is argued that the emphasis of law should be placed on insured’s fraudulent conduct in making a claim rather than on the result of the conduct. Accordingly, it is recommended that art.198 of the Criminal Law be reformulated to create a new conduct-based offence of fraud: fraudulent act with intent to defraud insurers of insurance money. The implications for this reformulation are also considered and solutions to the implications proposed.