11 January 2019

Why are the Private Investigators Important in Insurance Frauds?

An insurance policy is an important safeguard for individuals and companies. It guarantees against loss from accidents and, depending on the policy, other life-changing events. Companies can protect themselves, their assets, and their employees with the right kind of insurance policies. Similarly, individuals can protect themselves against possible loss of income and even safeguard their loved ones’ future in case of their death.

However, just like other social safeguards, there are people who are tempted by undeserved financial gain. The Coalition Against Insurance Fraud notes that $80 billion is lost annually due to insurance fraud. Any loss due to fraud not only affects the insurance companies but also the other policy holders.

With so much being lost to insurance fraud, an insurance investigator is an important asset to any insurance company. With their years of experience and various investigative skills, these investigators are able to confirm if a claim is fraudulent. This can allow companies to deny payment or minimize the amount that they have to pay.

Some Types of Insurance Fraud

Here’s a short list of insurance fraud that often occur:

Car Insurance – One common fraud is when criminals stage accidents where they purposefully collide with another vehicle or get run over by one. They would then place the blame on the other driver and claim against that person’s insurance. In this case, both the insurance company and the policy holder lose – the insurance company due to the fraudulent claim and the policy holder due to increasing premiums. Another type of fraud is when a claimant will falsely report their car stolen and collect insurance.

Health Insurance – Health insurance fraud occurs when a claimant charges for medical services that are not needed or are not covered by their policy. It can also occur when they are charging more to insurance than what the medical service actually costs.

Worker Compensation Insurance – This occurs when a worker suffers an injury but falsely claims the severity of the injury or that it occurred while working. There have been cases where “injured” workers were enjoying strenuous physical activities when they were supposed to be immobilized.