There are many attractive insurance services and offers made by the people in the insurance business these days. Sometimes we do get the benefits they state in their policy, but at other times we become a victim of their fraud. Health insurance is one field in which you need to be very careful before choosing an appropriate insurance company. Most people buy these so-called insurance policies and are not even aware of the fact that they have been deceived until they file a claim for their health charges to be covered under that policy and find out that that company does not even exist.
It is important to do a little investigation before you sign up with a health insurance company. This way you can prevent yourself from becoming a victim of health insurance fraud. One way to spot a fraudulent business is to see how much they are asking as down-payment. If it seems very low as compared to the cost of other insurance services, stop here. The best way to get insured is to ask a friend or colleague which insurance company they are signed up with.
Another way to escape fraud is not to get seduced by the attractive but uncalled-for mails that arrive in your mailbox quite often. Most of the time these mails are generated by people who gain profit when one of the customers responds to these mails and actually signs up with the insurance company. Try to call your friends and ask them if they have heard of any such company. You can also call the hospital or any other local care-center that the insurance company has listed to ask them if they have heard of the health insurance you are about to buy. If they are not sure make other arrangements to check their validity.
If you discover that you have been victimized by one such company, immediately contact the law enforcement agency active in your area. Tell them all the details you have of the health insurance company and how the claim you made was denied. You should also contact your State Insurance Commissioner if things do not seem under control. Of course sometimes there could be a misunderstanding as well, so do not rush to things. Just take one step at a time and be 100% sure that you are a victim of fraud instead of some error or misunderstanding on the part of health professionals.
Another important step to take is to contact your credit card company and ask them to either freeze your account or cancel any outgoing transactions. When you go to the law enforcement agency do not forget to take along all the canceled checks and the health insurance policy that you signed. This would be a useful step may the fraudulent company tries to deceive you in future with other similar offers. Just follow these simple guidelines and prevent yourself from becoming a victim of such frauds.
Insurance fraud has existed ever since the beginning of insurance as a commercial enterprise. Fraudulent claims account for a significant portion of all claims received by insurers, and cost billions of dollars annually. Types of insurance fraud are very diverse, and occur in all areas of insurance. Insurance crimes also range in severity, from slightly exaggerating claims to deliberately causing accidents or damage. Fraudulent activities also affect the lives of innocent people, both directly through accidental or purposeful injury or damage, and indirectly as these crimes cause insurance premiums to be higher. Insurance fraud poses a very significant problem, and governments and other organizations are making efforts to deter such activities.
The chief motive in all insurance crimes is financial profit. Insurance contracts provide fraudsters with opportunities for exploitation. One reason that this opportunity arises is in the case of over-insurance, when the amount insured is greater than the actual value of the property insured. This condition can be very difficult to avoid, especially since an insurance provider might sometimes encourage it in order to obtain greater profits. This allows fraudsters to make profits by destroying their property because the payment they receive from their insurers is of greater value than the property they destroy.
Insurance companies are also susceptible to fraud because false insurance claims can be made to appear like ordinary claims. This allows fraudsters to file claims for damages that never occurred, and so obtain payment with little or no initial cost.
The types of insurance fraud that exist are as diverse as the types of insurance policies that are available. Some of the major areas in which insurance fraud occurs are in the life, health care, automobile, and property insurance industries.
An example of life insurance fraud is the John Darwin disappearance case, an ongoing investigation into the faked death of British former teacher and prison officer John Darwin, who turned up alive in December 2007, five years after he was thought to have died in a canoeing accident. Darwin was reported as "missing" after failing to report to work following a canoeing trip on March 21, 2002. He reappeared on December 1, 2007, claiming to have no memory of the past five years.
Insurance fraud can be classified as either hard fraud or soft fraud.
Hard fraud occurs when someone deliberately plans or invents a loss, such as a collision, auto theft, or fire that is covered by their insurance policy in order to receive payment for damages. Criminal rings are sometimes involved in hard fraud schemes that can steal millions of dollars.
Soft fraud, which is far more common than hard fraud, is sometimes also referred to as opportunistic fraud. This type of fraud consists of policyholders exaggerating otherwise legitimate claims. For example, when involved in a collision an insured person might claim more damage than was really done to his or her car. Soft fraud can also occur when, while obtaining a new insurance policy, an individual misreports previous or existing conditions in order to obtain a lower premium on their insurance policy.
Both George Wood & Tarun Jaswani are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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