A 73-year-old retiree was in a minor accident two years ago. He was ready to compensate the owner for the damage caused, but the other driver sent her car to an assessment centre and his insurer received claims amounting to "more than $1,000", he said.

"It was just a kiss on the bumper, and her workshop actually quoted me $450 for the repairs," he recalled.

Upon examining photos taken by the centre, he found that "old wounds" on the car's boot and tail-lamps had been included.

But his insurer paid up and his "longstanding" 50 per cent no-claims discount was reduced to 20 per cent.

A 46-year-old businessman backed into a parked taxi last year. He got out and found the cabby standing next to his vehicle, smiling.

"He was watching me backing up and did not even stop me," he said.

He added the taxi's front bumper was "tilted" and the cabby wanted $150 in compensation. His offer of $50 was refused so he took pictures of the cab, and left. Soon, his insurer informed him the cabby was claiming "over $8,000" in damages. Parts "damaged" included the headlamps, bonnet, radiator and bumper.

He went to see the Consumers Association of Singapore (Case). "The (Case) investigator said it was a rip-off, and asked if I was prepared to go to court."

But his insurer paid up and he lost his no-claims bonus.

"From friends, I know these inflated claims are common. The insurance companies lose millions, and finally consumers end up paying higher premiums."

This article was first published in The Sunday Times on Apr 13, 2008.