Insurance Fraud Essay

Insurance fraud is when someone provides false information to an insurance company in order to gain something that they may not have gained if they told the truth about said subject (What Is Insurance Fraud). An example of insurance fraud would be if an owner of a vehicle decided to burn down their car and claim it was stolen to receive money from the insurance company. Insurance fraud is one of the most common types of frauds seen nowadays. Most people have heard of this type of fraud and may even have stories of it. There are many types of insurance frauds that occur around the United States. The majority of insurance frauds come in the form of life-insurance frauds.

Life insurance fraud can occur in many different forms. For example, it

For example, if an insurance agent tells you to write a check for a new life insurance policy to him instead of the insurance company (Sheridan, Terry). After some time you find out that the policy does not exist and the money is in the insurance agents account. Post-dated life insurance can occur when a policy is arranged after an individual’s death but it seems to have been issued prior to the death. This type of life insurance fraud often requires the assistance of an insurance agent (Ramotar, Cecil). Technology has made it much easier to detect this type of fraud for insurance

People are becoming more educated in insurance fraud. Specifically they are being told to not just turn over their policies but to ensure that they are receiving information on how the money is being set aside on certain death expenses such as paying for a funeral (What is Insurance Fraud). To combat the challenge of false identities insurance companies have began using data clearinghouses to validate the identity of applicants (Beattie, Andrew). Many insurance companies are creating whole departments dedicated to a fraud department to ensure that people trying to commit these types of insurance frauds are found. Red flags in this case would be if the social security number of this deceased person does not exist. Some companies have even started to monitor their clients directly to insure that they are not being scammed. They want to ensure that this large sum of money is a legitimate claim by someone for a family