The Cost of Insurance Fraud

, | 19/03/2018

As an average citizen who pays for insurance, the last thing you want is for your insurance rates to increase. Surprisingly, however, insurance companies share the same sentiment. The vast number of insurance carriers have a department of investigators that focus on stopping the primary cause of increased rates – insurance fraud. The filing of fraudulent or inflated insurance claims is the second most costly white-collar crime in the North America, costing the nation more than $40 billion per year.

Annually, the average family will pay anywhere between $400 to $700 in inflated premiums due to insurance fraud. The Special Investigations Unit (SIU) was established in 1978 to help combat this type of illegal activity, and it’s goal is to limit the amount of fraudulent claims and catch the criminals that are responsible. The SIU acts as the CSI of the insurance industry. They target organized crime, gangsters, crooked lawyers and doctors, and white-collar con artists. Added to the list is the average person trying to pad or inflate the actual loss.

Insurance fraud is a game of numbers. Rates are formulated through the use of mathematics and statistics to project risk. By lowering the probability of expensive insurance scams, insurers pass on the financial savings to the end customer through lowering or discounts of insurance premiums.

In today’s modern world, SIU’s job is quite difficult. Most offenders are not the run-of-the-mill criminal. They tend to be technologically savvy with access to expensive, sophisticated equipment. Criminals routinely create duplicate checks, fake medical records, false IDs and business licenses.

For anyone who has ever considered committing insurance fraud, consider this: on the average day, a person is caught on camera 12-16 times. This allows the SIU to access footage and images from ATMs, businesses, intersections, houses, cell phones and social media.

If you would like to help the fight against fraud, the best thing to do would be to document suspicious activity when you see it. Often, when it comes to solving cases like these, the devil is in the details. Some of the most common schemes to look out for include staged car accidents, adding damages to vehicles after a collision, and switching drivers after an accident occurs. If you see such activity, contact the SIU and/or law enforcement.

Here are some quick tips to avoid getting caught up in insurance fraud:

If you are involved in a car accident, call Investigation Hotline who will call police and record any unusual activities or circumstances.

Obtain and store bills for collision repairs, home and property repairs, and medical services.

Do not sign blank insurance forms.

Be cognizant of unexplained charges or double billing for any part of an insurance claim.

Gather as much information as possible at the scene of an accident.

Be aware that crime rings exist that specialize in “slip and fall” scams, which involve false claims and injuries.

If you have reason to believe that you’ve become entangled in insurance fraud, trust the experts and give Investigation Hotline a call at 416-205-9114.

To learn more, contact Investigation Hotline at 416-205-9114 or Speak with the Experts Now