Insurance Fraud. Yes, It’s a Thing and Yes, It’s a Crime.

Insurance Fraud. Yes, It’s a Thing and Yes, It’s a Crime.

Insurance fraud is defined as any act related to obtaining improper funds from an insurer in regard to an insurance claim. The severity of insurance fraud ranges from homeowners overstating the value of some of their personal property in a claim to doctors filing for payments for services never provided. Insurance fraud costs insurance firms and their policyholders billions of dollars annually.

It is also illegal.

Before you say “Not me” when it comes to insurance fraud, take a look at some common practices.

Car Insurance

Car auto insurance policies are ripe for insurance fraud. Common forms include getting inflated estimates to cover a deductible, not fixing the vehicle with settlement funds or attempting to get previous damage included in a damage claim. Insurance fraud can even start in the application process when an insured underestimates their driving mileage or “forgets” to mention a licensed driver in the family.
Health Insurance

Health insurance fraud can occur on both the insured and provider sides. Providers may bill the insurance company for services never provided. Insureds may overstate how healthy they are to secure better, more affordable coverage. If you’ve ever reviewed a hospital bill you understand how complicated the process can be.

Staged Claims

Some insurance fraud is pretty straightforward. This type of fraud includes staging losses to make claims against an insurance company. This can include burning down a failing business or staging an automobile accident to secure funds dishonestly.

If you file an insurance claim and feel like you may be asked some uncomfortable questions, it may be to limit insurance fraud. Insurance companies need to perform their due diligence in determining claims are legitimate. In spite of these efforts, fraudulent claims are filed daily.

There is a tendency for insured’s to try to “get the most” out of an insurance claim, and that to some degree is understandable. Just be cautious about crossing the line into an area of insurance fraud.

The best way to get the most from your insurance budget is by seeking the assistance of an independent insurance agent. Our agents can compare rates from multiple insurance companies getting you a better rate for the coverage you desire. Contact us and let our independent agents go to work for you!


Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Search All Blogs

Search
Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Want to learn more about
our blog writer?

Read more about KayLynn's background.

Search All Blogs

Search
Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Why Life Insurance Should Be a Fundamental Part of Your Financial Plan

How Are You Protecting Your Money Machine?

What is Decreasing Term Life Insurance?

Is Decreasing term Insurance Right For You? Would You Know?

Three Ways Life Insurance May Help Pay For College

How Life Insurance Can Play a Role in the Education of Your Child

Life Insurance as a Gift

Who Do You Know that Can Benefit?

What it Takes to Qualify as a Beneficiary

Do you have the right person as the beneficiary on your life insurance policy? Here’s who you should consider and when you may want to consider a change.

Unique Benefits of Life Insurance You May Not Be Aware Of

There’s More to Life Insurance Than You May Realize

What You May Need to Know About Filing a Life Insurance Claim

Filing a life insurance claim can be a relatively smooth, hassle-free process when you know the steps to take. Learn more in our latest blog.

When Should I get Life Insurance on My Child?

Reasons to Get Life Insurance on Your Child ASAP.

Beyond Life Insurance: Other Death Benefits for Which You May Qualify

There May Be Multiple Resources for Benefits Upon the Death of a Loved One

Situations When Term Life Insurance May Be the Best Solution

Term Insurance is a Flexible and Affordable Choice

Leave a Comment