Chances are, you have compared insurance providers to pay the lowest premium for your driving needs. Frustrated drivers who write monthly, quarterly or semi-annual checks complain about the hit to their wallet due to high premiums. If you are a safe driver and follow the rules of the road, you may wonder why you are responsible for paying high fees. The answer to that is insurance fraud. Insurance scam is prevalent and not only occurs with vehicle insurance. Insurance fraud investigations turn up reports of health care scams, homeowners insurance claims, false reports of lost / stolen jewelry, auto insurance claims, workers’ compensation claims, and more. If you’re surprised, don’t be: Nearly 1 in 6 Americans say they know someone who has been involved in a type of insurance fraud – that is, insurance fraud resulting from a workers’ compensation injury claim.
Insurance fraud is a white collar crime and ranks second to the costliest of white collar crimes behind tax evasion. White collar crimes are defined by the Federal Bureau of Investigation (FBI) as “those illegal acts that are characterized by deception, concealment or breach of trust and that do not depend on the application or threat of physical force or violence. “. White collar crimes occur at all socioeconomic and demographic levels, but the motivation is almost always the offender’s personal monetary gain. Insurance fraud, which costs each American more than $ 1,000 a year, is a white-collar crime that we all pay for, even those of us who are innocent.
To combat insurance scams, police departments and federal regulators are beefing up their investigative forces and imposing heavy penalties on offenders, including fines and jail sentences. Many police departments are also rewarding citizens who report insurance fraud cases with cash, a highly motivating incentive, especially in today’s tough economy. Some rewards go up to $ 25,000. Improving technology and open lines of communication between insurance companies, police departments, and federal investigation initiatives mean that identifying and tracking scammers is easier than ever. The message is clear: If you commit insurance fraud, you will be caught.
Law enforcement agencies are urging citizens to be aware of possible cases of insurance scams. Citizens can protect themselves by staying vigilant in the face of a simulated car collision, for example, or by resisting pressure from a person to leave the scene of an accident without filing a police or insurance report. False injury reports are also easy insurance fraud, and many times the perpetrator is working with a group called a “fraud ring” to organize “slip and fall” schemes that control large amounts of money for nonexistent injuries. Watch out for a suspicious house fire and report any strange incidents to your local law enforcement department.
Unfortunately, a tough economy leads citizens to less than honest means of making money. Make no mistake about it, insurance fraud is a crime and it is one that hits us all in the wallet. Take a stand when you suspect something suspicious – you can stop a longtime criminal and save countless money and resources by reporting the crime.