The lucrative nature of vehicle thefts and the relatively minor punishments handed out to perpetrators means it continues to attract a highly dedicated and professional criminal element, so security technology must constantly battle to keep one step ahead. Ana Paula Nacif investigates
According to the Home Office, about 320,000 vehicles go missing in the UK each year - 172,000 of which are never recovered. With recovery rates failing to improve and sophisticated criminal gangs effectively working across the country in national and international operations that baffle the police and insurers, what more can be done?
Although vehicle crime has decreased, theft of high-value cars is still rising, according to the Metropolitan Police. Given that this type of vehicle is not likely to be recovered, insurance companies agree that prevention is better than cure.
But one of the main problems is that this type of crime does pay. "This is a high-reward activity that involves very low risk. If a car thief is caught they are likely to go to prison for two years, which is not much in comparison to other equivalent lucrative criminal activities," explains detective inspector Stephen Lodge, Metropolitan Police Stolen Vehicles Unit.
Road to recovery
Despite the UK motor insurance industry being proactive in developing and testing security devices, recovery rates have remained steady over the past few years, fluctuating between 52% and 54%. Jack Brownhill, Groupama's director of motor, says: "We have an enviable track record in the field with the Thatcham security device, testing and listing activities, have played a major role. Despite the massive strides that have been made in the area of vehicle security in recent years. However, the current level of vehicle thefts remains unacceptable."
Fergus Curran, group claims manager at Equity Red Star, believes that recovery levels are nominal, "especially when you look at those vehicles that have been stolen to be resold rather than by joyriders".
High-tech paraphernalia, such as tracking systems, alarms, immobilisers, automatic driver recognition, smart keys and cards, plays an important part in helping curb theft, but it is undeniable that professional gangs have kept up with it and become incredibly specialised. And, with the market for 'to order' stolen vehicles getting stronger, there is no sign that the trend will be reversed.
Cloning and 'ringing' are major problems for the insurance industry and the police advise that security marks such as watermarks and microchips should serve as deterrents.
"The way forward is to make it more difficult for vehicles to be recycled back into the market. That would be a sensible deterrent," Mr Curran points out.
Older vehicles, which lack the modern security gear, are an easy target for joyriders and petty criminals. And, even though they are more likely to be recovered, some are 'burnt out' and deemed worthless when found; others are stripped for parts and never recovered.
Breaking into a vehicle is the old-fashioned way of stealing; nowadays, thieves do their best to get hold of the keys, and sometimes the driver too, to make sure that no security device will be activated. Therefore, the industry is concentrating on disabling mechanisms that could make the initial theft attempt and getaway much more difficult.
Phil Gledhill, claims technical manager at Norwich Union explains: "The industry is looking for safe protocols for the use of immobilisers. Such devices have been widely used in other countries but there is a discussion about safety. For example should the car stop when it is switched off or should you be able to stop it in other circumstances?"
Tracking systems also seem to be an effective deterrent and some insurance companies make them compulsory before writing the risk for high-value vehicles. "The number of recoveries reported by Tracker is on the increase and does in someway prove that insurers are, in many cases, recovering vehicles that historically they would not have. However, it should also be recognised that insurers are now insisting on more tracking devices being fitted to vehicles as a condition to the risk being accepted, especially vehicles such as BMW X5s, Audi TTs, Range Rovers and high-value commercial plant," says Duncan Bowker, spokesman for the Co-operative Insurance Society.
Ashley Cole, high net worth motor manager at Chubb, agrees: "It is a huge exposure and we make it clear to brokers that we require a tracking device fitted to vehicles that are worth over £30,000. In our experience, all stolen vehicles with tracking systems have been recovered.
"We underwrite the loss before it actually occurs and, if it does happen, we do everything we can, such as settling the claims within 14 days at a pre-agreed value, because we know the vehicle is not likely to be recovered."
Although insurers are encouraging policyholders to get a suitable tracking system, some feel that tracking companies should work more co-operatively with insurance companies. "We need better collaboration from tracking companies. They are good at telling how many vehicles they recovered but not the number of those that never appear," says Martin Hall, general manager, Zurich Private Clients.
Mr Curran argues that tracking systems should be made more affordable.
"Subscriptions are usually pretty expensive. If they were more accessible perhaps we could improve recovery rates significantly."
However, tracking companies are adamant that they have a good relationship with insurers and that their recovery rates are successful.
Tracking Star, which has fitted 21,000 vehicles since it started in 1999, claims that recovery rates have been consistently high - last April, it was 96%. The company says it takes an average of 20 minutes for a vehicle to be recovered. "The other 4% of vehicles that are not recovered are usually those that have been taken apart or put into containers," a spokeswoman explains.
Tracker, which fitted around 90,000 systems in 2003, claims to have an average recovery rate of 92%, but it refused to give the number of vehicles that were not recovered.
Another weapon the industry uses in its ongoing battling against vehicle theft and fraud - the police reckon that between 15% and 20% of theft claims are fraudulent - is a newly launched version of the Motor Insurance Anti-Fraud and Theft Register, the MIAFTR2.
The system has been redeveloped using internet technology to include information about vehicles recovered by the police, who will automatically notify insurers. MIAFTR2 also provides the platform for electronic information transfer to the DVLA in support of the recently launched Vehicle Identity Check scheme, helping to detect and prevent 'ringing' crime.
Martin Brassell, director of HPI, the company developing the new system, explains that this is the first time that police and insurers can access the database online, giving them realtime information. But data from the Police National Computer continues to be updated five times a week. "Real time is the way to go because it is the best way to detect fraud. We are trying to make as much information as possible available at insurers' fingertips. The system also offers data validation against the DVLA's record and, if there are any major inconsistencies, insurers are automatically notified."
Another way of preventing fraud, and to increase the number of recovered vehicles, is to scrutinise claims. According to Peter Taylor, business development director at Cunningham Lindsey UK: "Insurers need to ask more questions. When insurers scrutinise the claim, recovery rates improve because sometimes the theft has been arranged by the claimant, who may have second thoughts when they realise the insurance company will not pay up without investigating it first. It is not unknown for claimants to find their vehicles after an appointment had been made by the insurance company."
However, if criminal gangs are not going to go away and thousands of vehicles will continue to be snatched each year, what can the industry do to minimise the problem?
Mr Brownhill believes that the spread of CCTV and traffic management cameras can play a significant role, with their ability to read and validate thousands of number plates an hour. "There would appear to be a common perception among motorists that patrolling of our road network has been surrendered to speed, or should I say safety, cameras and that the only vehicle crime of any interest is speeding."
Most high-value stolen vehicles end up out of the country, the majority crossing the borders less than 24 hours after being taken.
The police recognise that they do not have enough resources to cope with the problem. Charlie McMurdie, chief detective inspector at Metropolitan Police Stolen Vehicles Unit, comments: "We have at least another 10 jobs waiting, but we have no resources to put into them. And the longer the wait, the worse it gets because they are bound to become more complex and lengthy."
She argues that if the insurance industry was prepared to put in cash to fund a permanent desk or operation to deal with criminal gangs, recovery rates would go up and millions of pounds worth of vehicles would find their way back to their rightful owners.
Another problem faced by the Metropolitan Police is the lack of effective communications with insurers. "Insurance companies could have a single point of contact for the police. That would save officers scrambling around trying to find the person they need to talk to. When you recover 300 vehicles, this process can be very time consuming," adds DI Lodge.
The Association of British Insurers, which is in discussions with the National Criminal Intelligence Services to fund a port initiative to prevent cars being shipped abroad, says that there has been a change in emphasis within industry, and that insurers are much more willing to give financial support to the police. However, discussions about the implications of funding a service that, by nature, is supposed to be public are still ongoing.
Jo Dagustun, ABI's head of motor, explains: "We look forward to increasing our co-operation with the police. On one hand it could be a good business case, but we are concerned about the implications of funding a public service and we have been debating on the issue for some time. But we believe that project-based funds are the best option because the money is ring-fenced and used for a specific purpose."
Motorcycles are at a greater risk of being stolen than other vehicles.
And, although theft has declined by about 7%, according to a recent survey by broker Carole Nash, one in 20 London motorcycles inevitably falls prey to thieves.
But, while manufacturers have put heart and soul into improving security devices for other vehicles, they have a lot of catching up to do before they can offer the same level of service to motorcyclists.
"Just a few companies do tracking systems for motorbikes and the product is not as good," says Nick Baker, head of motorcycles services at Carole Nash.
Mr Baker explains that one of the main problems is space because the system needs to be hidden. Another one is the market. There are millions of cars and trucks on the road. Compared with one million motorbikes, it is not difficult to see why the commercial incentive for manufacturers to develop better products is diminished.
Theft of motorcycles is also driven by the underground market of parts, which are disproportionately expensive. "Most bikes are stolen to order, especially the sports type. While you pay £8000 for a new one, if you were to buy the parts and put it together it would cost you £30,000," explains Mr Baker.
The police recommend the use of security marks on the saleable parts.
Mighty Dot, a company that makes security kits for vehicles, is planning to launch its motorbike product within the next six weeks. Gary Eyley, UK general manager, says: "We spray about 10,000 dots on the bike. These are virtually impossible to remove and enable the police to trace the original identity of the vehicle. If thieves know that they will not be able to sell the parts, they know it is not worth stealing that vehicle."
Some manufacturers are already fitting immobilisers as standard. "The problem is that they don't fit the alarm as well. We always recommend to customers to upgrade to an alarm-immobiliser system. You have to do as much as you can. We want people to use their bikes with confidence.
We advise policyholders to do an assessment of their security needs and ensure they have the right gear," adds Mr Baker.
Home Office figures show that 36 822 motorcycles and scooters were stolen in the UK in 2000. Only 37% of mopeds and scooters and 26% of motorcycles were recovered.
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