With the economy down, people are resorting more and more to insurance fraud as an easy and quick way to make some money. However, this means insurance companies are cracking down more and more. There is now a wide-established list of “red flags” (also known as “suspicious loss indicators”) that raise an insurer’s suspicion to spot potentially bogus claims. Take it from Tom Welsh, a member of the National Insurance Crime Bureau, “”The industry has many, many, many years of experience in detecting insurance fraud; don’t try it because it’s just not worth it.”
Not only does insurance fraud make victims out of insurance companies, but also their customers too. In the United States alone (excluding health insurance fraud) insurance fraud exceeds $40 billion annually! That price is paid by you and me in higher annual insurance premiums than you deserve, just because companies have to account for money lost to fraud. Therefore, as a consumer, insurance scams should concern you since the cost is passed directly on to you in the form of higher rates. According to the US Chamber of Commerce, fraud adds 25% to property and casualty insurance rates!
What is insurance fraud and what can you do to help fight it? Continue reading to learn more!