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Durban - Filling coffins with bricks, purchasing paupers’ bodies, insuring people who are already dead, declaring the living dead, and burying a woman’s body in a man’s pyjamas.

These are just some of the elaborate schemes used to cheat the long-term insurance industry of millions.

Life cover scams are now so rife that the Durban Commercial Crime Unit has arrested more than 35 suspects in the past three months for fraudulent claims.

Figures from the Association for Savings and Investment SA (Asisa), an industry body and lobby group, reveal that death, disability and fraudulent documentation and syndicate activity jumped from amounts involving R26.2 million in 2010 to R131.7m in 2011.

KwaZulu-Natal and the Western Cape have recorded the highest number of dishonest claims.

Police spokesman, Colonel Vincent Mdunge, confirmed that such crimes were “rife”, especially in Durban. But he said police were receiving co-operation from insurance companies and communities in helping to tackle them.


In the latest incident, the Durban Commercial Crime Unit arrested 10 suspects recently, aged between 33 and 59, on charges of fraud.

Mdunge said that in one case a 50-year-old man had allegedly taken out life cover with an insurance company on his uncle, who died in 2002, to the value of R1.5 million.

He said the suspect was paying monthly premiums a year ago while waiting to claim.

“On October 2012, he wanted to proceed with lodging a fraudulent claim. His dilemma was that the uncle he had covered was already deceased.

“To overcome this obstacle he approached a woman who works at a funeral service in Durban and promised her R15 000 if she could organise a dead body and papers which would help him secure a death certificate,” Mdunge said.

He said the woman set about finding a body that could be presented to a doctor for certification before being buried.

She approached a funeral service for help but they did not have a body that fitted the description, Mdunge said, so she sought assistance from another funeral parlour in Pinetown.

They had a body fitting the description, which was then presented to a doctor for a death certificate.

“But it could not be buried because it belonged to another family,” Mdunge said.

It was returned to the funeral parlour in Pinetown. Police say the parlour was promised R20 000 for its part in the scam.

But the funeral service in Durban still needed a body to bury and police believe that the funeral service in Pinetown again assisted.

Recently, after a six-month investigation, police arrested the 50-year-old would-be claimant, the 58-year-old owner of the Durban funeral service, the owners of the Pinetown funeral service, a 59-year-old woman who was promised R15 000 and a 33-year-old mortuary employee.

This past week, three women and a man, allegedly linked to the crime, were also arrested. Police are expecting more arrests as investigations continue.

The suspects, facing charges of fraud, appeared in the Durban Magistrate’s Court last Monday and are in custody.

The matter was adjourned until Wednesday.

Asisa deputy chief executive, Peter Dempsey, said most of the fraudulent claims in 2011 were uncovered by life insurers before the money was lost.

“Life companies are often seen as soft targets by criminals hoping to access benefits through fraudulent means.

“Life companies have, however, put sophisticated fraud detection mechanisms in place to allow for early detection,” Dempsey said.

Two weeks ago, police disinterred a coffin containing three bricks, buried in the eTafuleni Cemetery in Inanda.

A fake funeral was being held for a man who had been buried in Umlazi years ago.

Last month, police arrested two suspects aged 35 and 42 in Umbilo for fraud after they had allegedly produced a birth certificate for one Aphiwe Ntombela, who does not exist. It was used to insure her.

Police received information that the suspects had lodged fraudulent claims with three different insurance companies for an amount of R95 000.

In another case, KwaMashu grandmother, Florence Khuzwayo, 53, was falsely declared dead last year after her identity book was stolen and allegedly used to commit insurance fraud.

Also last year, three sisters – now facing charges of fraud – allegedly obtained blank documents from a doctor and used them to fake a death to claim life insurance.

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