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Fraud Facts
Fraud against insurance companies
negatively effects you, me, and our entire country's economy.
Common
Terms:
Insurance Fraud - The
intentional misrepresentation of material facts and circumstances to
an insurance company
to obtain payment that would not
otherwise be made.
Hard Fraud - Someone who
deliberately fakes an accident, injury, theft, arson or other loss
to collect money illegally
from insurance companies.
Soft Fraud - When a
normally honest person tells “little white lies” to an insurance
company.
Intentional Loss - Damage
or destruction of property willfully caused with an intent to
defraud an insurer excluding arson fraud.
Impact of Fraud:
Insurance fraud loss is estimated per
year to be $27.6 billion. Automobile fraud $12.3 billion, business
and commercial
$1.8 billion, homeowner fraud $1.8
billion and life/disability fraud $1.5 billion.
Insurance fraud, the white collars
second most costly offense, costs the American public approximately
96.2 billion dollars per year in
increased premiums alone. A study in 2001 by Conning and Co.
estimated that insurance fraud increases the average American
household costs by over $5000.00/year when the rise in premiums,
goods and services are taken into consideration.
Homeowner fraud which includes
property and casualty claims total a sum of about $30 billion per
annum. (Insurance
information Institute)
False
claims in the American healthcare system cost the U.S. an
approximate $54 billion a year. (CAIF)
In Canada, 10-15% of claims
paid out are fraudulent. The sum of general insurance fraud inflates
costs an estimated $1.3 billion per year according to the CCIAF.
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