Chennai, Mar 2 (IANS): The Indian government owned non-life insurer The Oriental Insurance Company Ltd has decided to take legal action against policyholders, intermediaries for fake motor insurance policies.

In a circular issued to all regional and operating offices in India, The Oriental asked them to take due legal action against policyholders, intermediaries committing fraud against the company.

The insurer said an alarming number of fraud and misrepresentation in motor insurance have been reported in the general insurance industry.

The frauds include four-wheelers being booked as two-wheelers and other alterations are made in the policy soft copy with the fraudsters pocketing the difference in premium deposited with the insurer and the one appearing on the policy.

According to The Oriental the modus operandi involves underwriting of such fraudulent cases mostly in the online portals of both the intermediaries and the insurers.

The insurer has asked its operating offices to closely scrutinise the policies issued online and if any fraud comes to light from a channel that scrutiny of all the policies issued by that channel to be made.