“That which does not kill us makes us stronger.” ― Friedrich Nietzsche

Insurance fraudInsurance fraud is a serious crime that impacts everyone. Insurance fraud leads to increased premiums for honest customers and in some cases, can endanger the life and wellbeing of others during the commission of the crime. Here are 3 major types of insurance fraud to watch out for.

1. Health insurance fraud – Unfortunately, health insurance fraud is very common and results in higher premiums for everyone. Examples of health insurance fraud include overbilling or billing very high prices for common procedures, billing for procedures not performed and performing unnecessary procedures. The best way to spot this form of fraud is to always look carefully at the Explanation of Benefits statements from your health insurance company. Make sure you recognize and verify that every charge on the statement is a service you received at that visit. If you find anything suspicious, call your insurance company and ask about the services you don’t recognize. In the doctor’s office, make sure you ask questions and understand what tests are being run and why. If something sounds fishy, you’ll want to look into it further.

2. Car insurance fraud – Car insurance fraud is another example of how a few dishonest people can make coverage more expensive for everyone else. One common type of car insurance fraud is when a vehicle owner sells the car to a “parts shop” or simply abandons the vehicle and then reports it stolen. The most frequent example of car insurance fraud is so common that you may not even recognize it as fraud – collecting for damages without repairs. In this case, an accident occurs that results in damage to the vehicle, the owner submits estimates for repairs to the insurance company and receives a check to cover the cost of the repairs, however, the owner simply cashes the check and fails to make the repairs to the vehicle.

3. Homeowners insurance fraud – There are numerous examples of ways people commit homeowners insurance fraud. One common example is when a homeowner has documented expensive possessions with the insurance company and sells the items without reporting it. In these cases, the fraud might be reporting those items stolen or staging a break-in or when a storm or natural disaster occurs, reporting those items damaged or lost. Another all-to-common example of homeowners insurance fraud is staged house fires. In these cases, the homeowner is rarely home and has an alibi for the time of the fire but has hired another person to set the fire in exchange for a cut of the eventual insurance pay-out. Staged home fires are also very common in cases where a homeowner has had to abandon the home due to relocation or impending foreclosure. Staged house fires also create risk to the wellbeing of others as other homes may also catch fire risking injury or death for those occupants, as well as risking the lives of the firefighters called out to put out the blaze.

Insurance fraud of any kind is a crime and it impacts us all with higher costs and ever-rising premiums. If you have knowledge that any type of insurance fraud has occurred, it is important to report it to the proper authorities.