7 Most Common Types of Insurance Fraud
7 Most Common Types of Insurance Fraud – Insurance fraud is once deception cares within the system of insurance. it’s going to be a case once someone makes a false claim from associate insurer. it’s going to even be once the insurance company disagrees to pay the applier. Records have tried that the speed of coverage frauds committed globally is increasing.
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It’s in the auto industry, in healthcare, home repairs, in the workplace, and more. It is a major financial burden to society. Costs from insurance fraud, with bogus claims and related costs, amount to billions of dollars every year. Since 2007, fraudulent claims in America have increased each year in almost every category.
Fraud drives up insurance costs for everyone as well as general prices of things like groceries and retail goods when businesses are forced to pass on higher insurance costs. It’s almost becoming a way of life. Here is a look at 7 Most Common Types of Insurance Fraud.
7 Most Common Types of Insurance Fraud
1. Health Insurance Billing Fraud
Unfortunately, health care professionals will sometimes get in on the insurance fraud act. One form of health insurance fraud is for health care providers to bill health insurance companies a high fee for a standard procedure, or to bill for services that were never rendered.
For example, you may go in for a regular check-up but your doctor decides to bill your insurance company for an in-office surgical procedure that never happened. The patient is the victim of fraud and does not even know it.
2. Car Accident
The next time you see a car accident, you could be watching insurance fraud in action. In most cases, the driver and accident victim are the only ones in on the scheme. In other cases, the driver, victim, insurance investigators and even some of the bystanders that give statements are in on the fraud. The value of the vehicles is greatly inflated and the insurance payoff is for two totaled vehicles.
3. Property/Asset Insurance:
During this state of affairs, individuals destroy their belongings simply to form a claim. typically they injury things that don’t seem to be terribly precious and create a claim for a better quantity to be paid. individuals even faux theft attack therefore on create a claim. sometimes individuals claim the second insurance once their losses are lined by another insurer.
Thus insurance frauds have an effect on the whole society. dishonest claims create insurance agencies expertise serious losses. so as to hide up for these losses, these agencies increase the fees of the honest policyholders, thereby, creating the honest voters pay a worth for fraud they are doing not realize.
4. Stolen Car
There are two ways that criminals perpetrate the stolen car insurance fraud scam. The first type of stolen car fraud is when a car owner sells his car to a body shop to be cut up for parts and then reports the car as stolen. The body shop is in on the fraud, so the authorities are never told about the sale for parts.
The second most common way that criminals commit stolen car fraud is to sell the car to an overseas buyer, make the transaction without any paperwork, ship the car overseas and then report it stolen.
5. Workers’ Compensation Insurance Fraud
Workers’ compensation insurance protects employees who are hurt on the job, paying for lost wages, medical and other expenses while the worker recovers.A small number of workers take advantage of this benefit and use it for personal profit, committing workers’ compensation fraud.
Acts of fraud include making false statements to get benefits, concealing information to get benefits, inflating costs, lying about how an injury occurred or making an exaggerated claim.
Protecting yourself against false claims for workers’ compensation involves careful documentation and reporting. You should get a written statement from the claimant describing his or her injuries, get witness statements, and document any discrepancies.
Send the information to your insurance provider and note if there might be issues with the worker who is submitting the claim.
6. Unnecessary Medical Procedures
If it seems like your doctor is ordering you to go for unnecessary testing, then you may be the victim of insurance fraud. If you go to the doctor for a sore arm but your doctor orders a series of blood tests that have nothing to do with your arm, then that could be a common form of insurance fraud.
7. Storm Fraud
Criminals will take advantage of any situation to commit insurance fraud, including a major storm. A common form of fraud that happens in the wake of major storms is homeowners will either enhance the storm damage to their home to get more of a settlement, or the homeowner will take advantage of how busy the insurance company is and call in a claim even if there was no storm damage.
Insurance fraud affects everyone in some form or another. When your auto insurance premiums go up, that is partly due to insurance fraud. If you know of insurance fraud that has been committed, then you should report it to your state department of insurance immediately. So Just it the article discusses about 7 Most Common Types of Insurance Fraud . Like and share this article and may be useful for you.
