Exaggerating Claims Inflating or exaggerating the extent of an insurance claim is a crime. Insurance crime increases insurers' claims costs and, ultimately, costs everyone in the form of higher premiums. Insurers will pay you for your reported losses according to the levels of coverage, deductibles, etc., outlined in your property policy. Your adjuster will review your receipts and the other details of your claim to ensure you receive the appropriate value and service for the policy you purchased. Insurance cannot be a source of profit.Types of Claims FraudPeople sometimes exaggerate the scope of their losses or fraudulently claim a loss for something that they never actually owned. Examples of exaggerated claims include:After a basement floods and water damages a freezer, expensive AAA steaks are fraudulently listed as among the spoiled frozen foodsA pearl necklace is lost and the claimant exaggerates the size and value of the pearlsAfter a fire, items such as furniture, jewellery or art that were never owned or on the premises are claimedA claimant submits a receipt that belongs to someone else when a claim is made.Penalties for Making a False ClaimIf an insurance adjuster suspects that even a portion of claim is exaggerated, payment for the entire claim – even the valid losses – could be put in jeopardy. Individuals who have fraudulent claims turned down may have difficulty obtaining insurance in the future. Because inflating or exaggerating a claim is a crime, insurance companies may contact the police to press charges. There is no such thing as a victimless crime. Everyone who buys insurance pays the price of insurance fraud and inflated or exaggerated claims in their premiums. Related ServicesRestoration FraudIf insurance is paying for contractors to fix damage to your home, be aware of restoration fraud. A vendor may overbill for the job under the assumption that your insurance company will pay the full amount. Recognize signs of potential fraud and never pay up front.Identity TheftIf your personal information is stolen, criminals can use it in elaborate schemes, including insurance fraud. Learn how to safeguard your identity. Useful LinksBuying Home InsuranceAs a homeowner, you need to insure your house for replacement costs so that in the event of serious damage or destruction you have adequate coverage. Be sure to keep your home insurance current by reporting material changes or upgrades.Home Inventory ApplicationA current inventory of your belongings makes it easier to file a claim. Keeping your records off-site is wise in case a fire or flood damages your property. Consider updating your home inventory each spring and advise your insurer of any major purchases.