Anyone who has filed an insurance claim should know that it can be a complicated matter completing reams of paperwork, meeting with adjusters and fighting to defend your claim. On the other hand, sometimes you simply complete the claim form, and your check arrives in a few days. Some have discovered that this second scenario often makes it easy to commit fraud.
Studies have shown that one in every 30 insurance claims is fraudulent. Insurance fraud is responsible for higher premiums and stricter laws. California and federal law enforcement are zealous about tracking down and prosecuting those who commit fraud. A conviction for insurance fraud can mean fines, jail or prison, and restitution, depending on the severity of the offense. If you are facing accusations of insurance fraud, you have a right to be concerned.
Kinds of fraud
A little white lie or an omission of pertinent information on an insurance application or claim is perhaps the most common form of fraud. If the insurance company discovers an inaccuracy or misrepresentation on your claim or application, it will likely cancel your policy and deny you coverage. However, you may also face criminal charges if the insurer believes that you intentionally committed fraud. Some common examples of insurance fraud include:
- Auto insurance: False reports of stolen or damaged vehicles, charging or listing charges for repairs you didn’t make, staging accidents, claiming injuries for passengers who were not in the vehicle
- Property insurance: Staged burglaries, claiming non-existent damage from natural disasters, false slip-and-fall claims, inflated damage claims
- Life insurance: Faking a death, purchasing insurance on someone who does not have long to live, murder-for-hire
- Health insurance: Overbilling insurers, using someone else’s identity to file false claims, providing medical services a patient does not need
Medical fraud consumes about 10% of the nearly $3 trillion consumers spend on health care each year. While convictions are usually of health care providers and those working in medical offices, patients may be charged for participating in schemes for a portion of the profits.
California investigations into insurance fraud often involve numerous law enforcement agencies and the Department of Insurance. The most challenging part in the prosecution of insurance fraud is proving intent. Even if you received no money from an insurer, a court may still convict you if prosecutors can prove you intended to commit fraud. Consequently, it is important that you establish a strong defense if you are facing charges of insurance fraud.