Fraudulent Claims on the Rise Insurance fraud is a bigger problem in the United States than you might guess. And the people who commit it are increasingly creative. Such fraud costs American tens of billions of dollars a year. And unfortunately, they’ve become more prevalent, thanks to a sluggish economy that’s causing some people to resort to desperate measures to bring in a little cash. Insurance industry studies indicate 10 percent or more of property/casualty insurance claims are fraudulent. Over a five-year period from 2007 to 2011, property/casualty fraud amounted to about $32 million each year, according to the Insurance Information Institute (III). Insurance fraud is the second most costly white-collar crime in America behind tax evasion. Not only does fraud cause higher insurance rates, but it also raises our taxes and inflates prices for consumer goods. Insurance cheats range from organized criminal enterprises to unscrupulous doctors and lawyers, to dishonest body shop operators, to your neighbors. Regardless of who they are, insurance criminals are motivated by one thing: money. Its all about greed and taking what isnt rightfully theirs. By type of insurance, the five top types with questionable claims start with personal automobile, up 13% between 2011 and 2012 (the most recent available statistics.) Homeowners personal property ranked second, up 45%, followed by workers compensation, up 29%. Commercial auto questionable claims were up 15%, with commercial and general liability up 3% for that year. The National Insurance Crime Bureau (NICB) has developed a list of 23 “suspicious loss indicators.” These are items within a claim or its circumstances that signal the claim may be fake. Here are just a few of suspicious loss indicators insurance agents should be aware of: *A claimant who is totally calm and unflustered after submitting a large claim. *A claimant who submits handwritten receipts for repairs on a covered item. *A claimant who adds or increases homeowners or auto insurance coverage shortly before submitting a claim. *A fire-damage claim for a home or auto where the fire started immediately after a family argument or shortly after family members left the home or car. Of course some of these scenarios can be legitimate claims. However, when suspicions loom, agents need to contact the assigned claims adjuster and/or the Special Investigations Unit (SIU) at siureferral@amfam or call Extension 31061. These specialists can perform an amazing array of tests and checks to investigate those trying to commit fraud.
Posted on: Mon, 20 Jan 2014 20:26:17 +0000
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