How Insurance Agents Spot False Claims

Insurance company statistics show more fraud occurs in down economies. As the economy gets shakier, people start to look for more and varied ways to turn some quick cash. Insurance fraud often looks like an easy payday when times get tough but the truth is, it can not only cost you some hefty fines but some jail time as well. Fraudsters believe that if their fake claims are small, they will slide by under the radar but that just isn’t true. When times get tough, insurance companies know fake claims will be on the rise. That is why they have special teams of agents with experience in law enforcement to conduct thorough investigations and sniff out false claims.

Insurance fraud is any deliberate action from a consumer, agent, company or adjuster made to obtain an unlawful financial gain. This deliberate action can happen at any juncture of the insurance process including selling, buying, using or underwriting. Insurance fraud will either be from an individual committing fraud against the consumer or against the insurance company. It is estimated that over a hundred billion dollars in false claims are made each year causing higher prices for consumers and an inability of the companies to properly compete with other companies as well as their future feasibility.

Stopping insurance fraud and even recognizing it, is harder and harder as fraudsters come up with more elaborate and efficient ways of ripping off the companies. Insurance scams occur in every realm of insurance. Workers comp fraud is rampant as well as medical and health insurance fraud. Auto insurance fraud is the most costly and prevalent. While difficult to prevent, auto insurers Special Investigative Teams have identified the most often used scams and are constantly on the look-out for them.

Gullible Driver

So many drivers try to pull the gullible, naïve car owner trick as a way to scam an insurance company. Most often they will just leave their keys in the car and park it unlocked. An accomplice will then come and steal the car. People most often do this when they have missed a few payments and have fees, fines and payment stacking up like bricks. They hope a stolen car will net them a huge payment as well as negate the large bills that are accumulating. Unfortunately for them, insurance fraud investigators look first at how many car payments are behind. Several overdue payments and a missing set of car keys is a dead giveaway that a fraud is probable. This particular scam almost always gets busted.

Burning the Evidence

Another tactic fraudsters use is to attempt to burn the car and claim vandals are to blame. This scam is particular hard to pull off in today’s tech savvy world. Arson investigators can easily distinguish burn patterns and use computer simulation to tell how and where fires started. Investigators also check car payment info and are suspicious when they find long overdue payments. Just like a CSI team, insurance claim investigators can piece together evidence of this scam easily.

Car Accident Injuries

Drivers and passengers involved in car accidents often try to exacerbate the injuries received in the accident or even completely make them up. This scam rarely works as insurance companies pay millions to medical experts in order to have them differentiate real injuries from fake ones and determine the extent of any actual grievance. People exacerbate every injury from whiplash to back injuries but it is easily proven false by an insurance companies investigative team. They examine the damage to the car and can tell what type of injury and the extent to which it could be harmful to the driver and passengers. You can’t legitimately claim whiplash if the car wasn’t hit from behind.

Additional Victims After the Fact

Another popular scam is to say there were more people in the car when an accident occurred than actually were. One of the most important factors investigators refer to is the police report and third party witnesses to accidents. If what the drivers insurance claim says differs from the police report and witness testimony, it is a sure sign fraudulent activity is present.

Old Damage

Many people try to add old damage to a claim when they have an accident. The problem here is that investigators can tell how old the damage is by analyzing rust and wear patterns. They can easily determine how long any dent, scratch or ding has been in the car.

New Insurance for an Old Loss

One of the all-time classic insurance scams is when drivers attempt to obtain insurance for damage that has already occurred. This usually occurs when something happens that isn’t already covered in your policy. For instance, a driver may not have added comprehensive and collision coverage but experience a tree branch falling on their car. They call their insurance company and add the benefits just to call back later to claim the damage. Investigators use several techniques to determine fraud in these types of cases, including checking to see if you have called body shops for repair quotes prior to adding the benefit to the policy.

Insurance fraud is a never-ending game. People are always trying to get a little extra money in any way they can and are constantly coming up with new and inventive ways to defraud their insurance company. Companies know this, however, and are countering with thee special investigative teams. Pulling off an insurance scam is harder than ever and not worth the time invested. Especially if you end up in jail and charged with more fines than you would have gotten in the scam.

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