Some common insurance scams that are raising your premiums
The poor state of the economy is considered a factor in the variety of conditions that affect the lives of people everyday and your insurance premiums are no exception. With prices seeming to rise every time you open your wallet, it is still a shock if you receive notice of a premium increase from your insurers.
If you are one of those citizens who pay your premiums on time, keep to the conditions of your policy and are regarded as a loyal consumer, you could still have to pay more for your insurance. The reason is simple and created by various circumstances generally beyond your control by insurance fraud or “scams”.
During the third quarter of 2010, the National Insurance Crime Bureau received more than seventy thousand claims regarded as “questionable”. When compared to the same period in 2009 it was an increase of about twelve percent. The incidence of insurance fraud is no stranger to providers but it is showing a steady increase in for example auto insurance and medical claims.
Some of the usual “scams “involve almost movie style scenarios while others rely on plain and old fashioned blatant lies. Creating false damage to property is a popular favorite where the insured deliberately damages or loses their assets and then files a claim, which enlarges...
The faking of vehicle accidents and auto theft could be other causes of your insurance premiums increasing. Because of “no-fault” policies in states such as New York, in 2009, insurance providers paid out additional expenses of $230 million caused by auto fraud. It was natural to expect that insurance companies would pass these costs directly to their customers. Injury claims have been for a long time and for many criminals a lucrative form of income and the old slip and fall routine is still popular today. In cases like this, claims made against businesses and homeowners have gone sky high!
Insurance “scams” are not limited to any particular group of people as reported by the Coalition against Insurance Fraud. It is recognized that the white-collar criminals including doctors and lawyers contribute to the highest flow of settlement money from insurance companies. Patients may become victims of fraud by being double-billed by doctors abusing health programs. You could see a doctor for a routine check-up but your insurance company is billed for other and expensive procedures. In addition, treatments although charged for were never carried out, or surgeons perform unnecessary and expensive surgery.
Fraud is a criminal act and those committing it will take full advantage of any opportunity, including an act of nature. The result of storm damage is ideal for some property owners to enhance damage or for renovators to inflate prices. Tenants of homes or apartments perform another type of insurance fraud. They arrange for a tenant’s insurance policy that will cover the value of their possessions on the property. Should they need money or just before moving out of the property, they will sell the possessions and submit an insurance claim for theft.
Unfortunately, it is the honest and genuine policyholders who are forced to carry a large portion of the losses resulting from insurance fraud and which contribute to the increasing cost of premiums.