With the current economic climate putting the squeeze on budgets more people are considering insurance fraud. People who would normally never consider stealing or taking what was not theirs sometimes think that insurance claims should be treated as some sort of windfall or opportunity to profit illicitly. They are wrong! Committing insurance fraud is a crime and can lead to arrest, court, and even prison! Insurance fraud also raises the costs of insurance for the rest of the honest people – not very nice!
Most people try to justify insurance fraud by saying that bumping up an insurance claim does not hurt anyone. Why not take advantage of a recent break-in to get a new big screen TV… one that you never had? Who will it hurt, only the insurance company. Nothing could be further from the truth.
Not only regular people are bumping up insurance claims but celebs and wealthy people are doing it too. In fact, because they are celebs and wealthy they think that they can get away with outrageous or fraudulent claims. Who would question a movie star or famous rapper saying that a million-dollar watch was missing? Insurance claim investigators will question claims that seem out of line, that’s who!
Recently a popular music celeb claimed that his daughter lost his Jacob & Co. watch bedazzled with 30 carats of diamonds and put in an insurance claim for $1.8 million. The insurance company soon denied the claim for several reasons: 1) the celeb insured the item for twice what he paid for it 2) He claimed the watch stolen 4 months prior to claiming his daughter lost it. It doesn’t Sherlock Holmes to see problems with this claim, does it? And trust me, insurance companies do hire and train people to be as sharp as Sherlock Holmes and his best friend Watson – they have to. Insurers must protect themselves and the bulk of customers who are honest. They want to offer the lowest possible rates and this demands that they do not pay exaggerated or false claims.
Insurers are taking a harder stance on insurance fraud and are applying a zero tolerance approach. Not only are fraudulent claims being denied but the insurance companies are getting the police involved.
Please remember, insurance fraud hurts US, the fraudster might pretend to themselves that the crime is victimless but it affects all of us negatively.
Insurance fraud cost the insurance industry in excess of $1 billion each year and the insurance companies are forced to raise premiums. So because of the new increase in the incidence of insurance fraud we are forced to pay higher premiums.
By reporting suspected insurance fraud, we can make potential criminals think twice, and help keep insurance affordable for honest policyholders.
If you know someone who has committed insurance fraud, GET IN THE KNOW! head over HERE to find out how to report it!
Disclaimer: Although this post has generously been sponsored by Insurance Bureau of Canada, the opinions and language are all my own, and in no way do they reflect policy of the Insurance Bureau of Canada.