The business of fraudulent insurance claims

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Today, there are some that make a living specializing only in insurance fraud by submitting doctored up insurance claims. The false claims received may include life insurance, third-party policy, personal damage and car theft.  In many cases, the claim amounts asked for are considerably higher than the injuries, damage or loss that occurred – this can raise a red flag to potential wrong doing.

Life insurance fraud is when someone makes false claims about faking an injury or death. 

The false documentation used is usually police reports, medical cards, marriage certificates, burial certificates and other relevant documents.  Usually the perpetrator prepares forged documents, applies for claims, and shares the claimed money with the other people involved.

When reporting a non-existent accident, that is considered to be a third party claim fraud.  These are usually submitted by an insurer and lawyers helping with the claim process.  Documents used to submit this type of fraudulent claim are hospital records, specialist reports, police reports and other documents with false information.

Personal damage claims are usually related to an accident case where the real amount claimed is greater than what would be reasonable from the insurer’s standpoint. According Federal Commercial Crime Director Comm Datuk Syed Ismail Syed Azizan, the main offenders in these cases were the workshop owners, workshop employees, adjusters and customers.  Azizan also said, “Investigators are required to ascertain the actual cost of repair to prove the amount claimed is correct and not more. ” He also added that professional opinions are required in order to determine the real amount of loss that was incurred.

Car theft is the most common fraud committed.  The driver would change their third party policy to a comprehensive policy before submitting a stolen car report to the police.   In many cases the owner would submit a second report concerning the stolen vehicle if the first one was denied. The practice of multiple claims sometimes works due to large companies don’t cross check and communication is often lost between departments.

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