Insurers may take harder line over shoplifting

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WELLINGTON - Retailers' insurance policies may be changed to offer incentives to those installing tougher security, following a study showing shoplifting costs the country $580 million a year.

Revelations about the extent of shoplifting - estimated to cost each household $400 a year through increased prices - were made in a University of Otago study released last week.

The study prompted the Wellington Chamber of Commerce to criticise big retailers that failed to take sufficient security precautions.

Insurance Council chief executive Chris Ryan said he had been "very surprised" at the cost of shoplifting.

He did not believe the issue had been examined by insurers before, and said the council supported the chamber's suggestion.

Retailers made "enormous" claims for stolen goods but insurers had never broken down the nature of the thefts.

The study showed that about 56 per cent of stock losses were caused by customer shoplifting and 26 per cent by thieving employees.

Mr Ryan said he would soon speak to industry members about ways to tackle that type of theft.

"The study has exposed a fairly significant problem, and we clearly need to have a good look at it. The scale of the problem just can't be ignored."

Insurers would have to start looking at just how carefully they should be scrutinising retail businesses.

He said a likely change would be to offer companies the same sort of incentives offered to householders who installed security systems and fire alarms.

"They just need to lock their doors and ensure their premises are secure."

Retailers had to understand the more they claimed the greater their insurance costs were.

However, Morley Security and Investigation Group's managing director, Trevor Morley, said encouraging businesses to spend money to save money - by installing proper security systems and training staff - was difficult.

The most effective method of preventing what he called shop theft - the term "shoplifting" minimised the crime - was to train staff to become more alert, he said.

This included encouraging sales assistants to speak to prospective customers to remind potential thieves that staff were aware of what they were doing.

Other staff - including cleaners - should also be on the alert for changes or theft.

Dishonest staff were another major problem. Many employers did not want to believe that their staff were stealing from them.

- NZPA