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Information About Insurance Fraud
More than half of the Americans are not aware that
insurance fraud is also one of the major influences in the skyrocketing prices of the insurance premiums all over the country. According to the NICB or National Insurance Crime Bureau, insurance fraud is taking more than $200 every household annually.
The NICB defined insurance fraud as the falsification of facts and events made intentionally by the person when presenting it to the insurance company so that they can get funds in an illegal way. This is actually one of the most popular white-collared crimes along with tax evasion.
Insurance fraud is not only done by policyholders. It can also be done by the applicants, by the third party claimants, and even those who are professionals who are rendering services to the injured people caused by accidents such as the chiropractors and the physicians. There are also times that the insurance agents can be tempted of committing
insurance fraud by giving false information to their clients. As a result, the customer will be paying for a coverage that is not included in his insurance policy.
Hard and Soft Insurance Fraud
The so-called Hard Insurance Fraud happens if someone is had deliberately attempted to create an accident, theft or injuries that are included in the insurance coverage in order to claim money.
When it comes to the falsification of
auto insurance, the crash test dummies refer to the real people who were trying to put up a fraudulent accident. These crash test dummies will ask other people so that they would help in participating in the scam. There were enticed because of false promises such as medical benefits, money, essential documents, legal support, and others.
Meanwhile, the Soft Insurance Fraud happens if the policyholder declares an exaggerated amount for the damaged properties or for the medical expenses. Although the claim is legitimate, the policyholder will be asking so much from the insurance company hoping to get extra refund. Some of the misrepresented information in a soft insurance fraud includes the miles driven by the vehicle, the place where the car was parked, or inaccurate medical records when claiming for the health insurance.
The cases of soft and hard fraud insurances both contribute to the increasing rate of the policies. Unfortunately, for the insurance companies to be able to keep their business up and running, they have to let the consumers to shoulder their lost expenses due to fraud insurance.
As of today, the NICB along with the NAIC or the National Association of Insurance Commissioners and the rest of the department of insurance all over the country are joining efforts so that they can fight against fraud insurance. They are also trying to reach to the customers as well so that they can protect themselves from people who are trying to use them for this type of insurance scam.
Aside from that, there are now programs that are meant for the consumers and the law-enforcement officers that would help in stopping the fraudulent act.
Fighting insurance fraud is a difficult war to wage, but government assistance in combination with consumer knowledge can make all the difference.
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