Claims on motor insurance are a regular issue
The recession prompted a rising number of fraudulent insurance claims last year - such as the case of one motorist who pushed his own car over a cliff.
Some 107,000 claims worth a total of £730m were found to be false last year, according to the Association of British Insurers (ABI).
The value is up 30% on the previous year, and the figure has risen in each of the past four years.
The ABI said fraud was "more of a temptation" during a recession.
While detection of fraud has risen, the group also suspected that the actual amount of fraudulent claims for motor and household insurance had also increased.
Fraudulent claims were most common on home insurance, with 55,000 false or exaggerated claims detected last year.
False motor insurance claims were the highest by value, at £360m. One of these cases involved an owner who reported his car stolen from a car park.
Later, he admitted he had pushed the car over the cliff and planned to use the insurance payout to pay off his debts, the ABI said.
Another claim for "recovery expenses" by a man holidaying in West Africa was declined, as it included services at a local brothel.
"Fraud thrives in a recession, so insurers are intensifying their crackdown on insurance cheats," said Nick Starling, the ABI's director of insurance.
"Fraud adds an extra £40 a year to the average premium, which is why the harder we make it for the cheats, the more competitive premiums will be for honest customers."
Detected fraud stood at £260m when the ABI first collected figures in 2004, rising to £410m the following year, up to £470m in 2006 and then rising again to £560m in 2007.
Sue Cowes, a fraud investigator for Norwich Union, said the majority of insurance claims were still genuine.
She said factors she looked out included unusual remarks, whether a customer had made a series of claims, and whether a policy had just been taken out.
"Unfortunately people are exaggerating some types of claims," she said.