Insurance Crime

Opportunistic Fraud Scenarios

When someone uses a legitimate loss to make an inflated claim and obtain an unwarranted insurance payment, this is known as opportunistic insurance fraud. These situations can involve: 

• Pre-collision vehicle damage that is included in an auto insurance claim
• Additional damage that is inflicted to the vehicle after a collision to increase the cost of the repairs
• A person who exaggerates injuries following a collision to collect benefits (also known as personal injury fraud). Examples include:
• Malingering injuries and extended recuperation time
• Medical services fraud involving a health care practitioner who exaggerates the severity of a patient's legitimate injury and increases the amount billed for assessments, treatment and/or assistive devices

• Offering or accepting "free" health care treatment for an injury that is unrelated to a collision or not medically necessary
• Encouraging anyone to participate in fraudulent activity
• Misrepresenting the condition, mileage, or value of installed components of a vehicle that has been stolen 
• Making a claim for property that was not actually stolen or damaged during a real vehicle theft or break-in

Misrepresenting the facts regarding fire, water, theft or collision damages so that otherwise uninsured losses can be claimed. 

Premeditated Insurance Fraud 

This type of fraud occurs when someone devises a way to claim for an insured loss event. Premeditated fraud often involves extreme action, such as:

1. Causing a vehicle collision with unsuspecting drivers or staging a collision with other conspirators. One or more people then claim and collect benefits from insurance companies for non-existent injuries. This kind of fraud may also have related financial and human costs, as unsuspecting victims often suffer very real injuries.
2. Making an insurance claim for an event – collision, vehicle theft, break-in, etc. – that never happened
3. A health care facility charging an insurance company for medical services that were never provided
4. A health care facility using a medical practitioner's professional credentials to charge an insurance company for services that were not rendered
5. Encouraging anyone to participate in fraudulent activity
6. Intentionally burning a vehicle
7. Falsely reporting a vehicle or its contents as damaged or stolen
8. Devising a way to avoid paying insurance premiums, including:
• Reporting residency at one address when living at another
• Not reporting licensed drivers in the household, or misrepresenting primary vehicle drivers – this may occur when an inexperienced driver is actually the principal driver but a parent or grandparent is reported as the principal driver on the policy
• Knowingly purchasing phony proof of insurance cards or pink slips
• Failing to report significant changes to the condition, value or use of insured vehicles – for instance, making deliveries or transporting passengers for a fee or as part of a paid service such as a daycare when a vehicle is insured only for personal use.