Insurance Fraud Management

HOW SERIOUS IS THE INSURANCE FRAUD PROBLEM?

Insurance is one of the most costly white collar crimes in America, ranking second to tax evasion.*

According to the National Insurance Crime Bureau (NICB), 10 percent of property and casualty insurance claims are fraudulent.

WHO PAYS FOR INSURANCE FRAUD?

Insurance companies, policy holders, taxpayers and the general public pick up the tab through increased insurance rates, higher taxes, and inflated prices for consumer goods and services.*

NICB estimates that property and casualty based insurance fraud cost Americans $30 billion per year. In comparison, Hurricane Andrew's devastation totaled $17 billion in damages. If you include other insurance lines like health, life and specialty insurance, the total cost of insurance fraud may exceed $120 billion annually.

WHO COMMITS INSURANCE FRAUD?

Insurance fraud perpetrators can be members of complex organized fraud rings or a neighbor looking for additional income. People who would never think of committing a crime can find the temptations of claim money from insurance fraud hard to resist.

FRAUD HURTS EVERYBODY WHO BUYS INSURANCE

NICB states the average household pays an additional $200 to $300 in insurance premiums every year to offset the cost of fraud. The "hidden fraud tax" paid in the form of higher prices for goods and services, may increase the cost to $1,000 per year, per family.

EXAMPLES OF INSURANCE FRAUD

Staged accidents: one or more individuals cause intentional collisions in order to get insurance claim payments.
Phony injury claims: people lie about injuries they have sustained.
Phony vehicle theft: the owner simply abandons their vehicle and then claims it was stolen.
Reporting a phony burglary of a residence or a vehicle break-in and faking a loss.
Overstating the value of items stolen after an actual burglary of a home or vehicle.
Falsely billing for healthcare-related services.
Making or selling fraudulent automobile liability insurance cards.
Receiving disability benefits when not disabled and able to perform the functions of the job.

These are just a few instances of criminal insurance fraud. In most cases, when a person commits insurance fraud they will also have committed other criminal acts, such as falsifying documents and theft.

HOW CAN YOU AVOID BEING A VICTIM OF INSURANCE FRAUD?

When Buying Insurance

Ensure the company is licensed.
Beware of unsolicited offers or offers to upgrade coverage.
Beware of unreasonably low premiums.
Beware of investments that are too good to be true.
Be sure you receive the policy within 60 days
Protect your insurance policy numbers.

When Filing a Claim

Review your medical bills.
Review all Explanation of Benefits.

When Driving

Look beyond the vehicle in front of you.
Allow ample space between your vehicle and the vehicle ahead of you.

If You Are In a Collision

Call the police.
Count the number of passengers in the other vehicle
Get all the names and telephone numbers of individuals involved.
Carry a disposable camera and take pictures.

HOW CAN YOU FIGHT FRAUD?

Report all suspected fraud crimes to Texas Department of Insurance Fraud Unit. Online Fraud Reporting
Learn about fraud schemes and protect yourself against fraudulent acts.
Make sure the information you provide to your insurer is accurate.

*Information provided by the National Insurance Crime Bureau (NICB)

Thanks to: Texas Deparment Of Insurance.
http://www.tdi.state.tx.us/fraud/faq.html