INSURANCE FRAUD PRIMER(Part -1-)
When reviewing a claim, one or more of these indicators may suggest a potential fraud. Indeed, the more you find, the higher the prospect of fraud and the more important it is to investigate thoroughly. Most policyholders are honest, a claim must be given every opportunity to prove itself genuine, inconsistencies naturally surface in a properly conducted investigation.
This series is broken down into the important claims fraud components. I will address each component on a weekly basis. This week I will start with the policy. What does it cover? what does it not cover? Is the person and property covered? Does it fall within the policy period? Have the exclusions and conditions been addressed? and more. The following areas should be addressed (at a minimum) as they relate to the insurance (policy) contract.
Loss within first year (or sooner) of purchase of coverage
Loss shortly before renewal/expiry of cover
Loss shortly after increase in coverage
Notification of claim after policy lapse/cancellation
Existence of multiple policies covering same loss
Premium payment abnormalities
Pre-loss enquiry re cover/claims circumstances
Non-disclosure/misrepresentation
Frequent changes of insurer
Gaps in previous insurance history
Evidence of significant over insurance/under insurance
Policy arranged via agent far away from insured's home
Poor claims history
Claimant appears to be different from policyholder
Questionable use of property/occupation at time of loss
Very knowledgeable about the policy
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