What is insurance fraud?
When an insurer is deliberately fooled, insurance fraud occurs. The purpose of the fraudster is to obtain benefits from this deception. There are various forms of insurance fraud and by no means everyone who commits fraud actually sees themselves as a fraudster. But reporting additional stolen items to the insurance company after a burglary is also fraud. As is claiming old damage when repairing your damaged car.
Insurance fraud is taken very seriously by insurers and a great deal of time is spent recognizing, detecting and fixing it. If you are caught committing fraud, there can be serious consequences. For example, not only do you have to pay a standard fine, but you can also be reported to the police. Also, by committing fraud, it becomes more difficult to get new insurance at a later date.
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Examples of insurance fraud
It has been shown by the Association of Insurers that most fraud is committed with liability insurance, household insurance and car insurance. Every year, thousands of insurance policies are applied for with false information and a large number of claims are wrongly made. In addition to the above examples of insurance fraud, there are therefore many other examples to consider. For example, when luggage is lost, it is common to lie about the contents of the suitcases. Fraudsters then declare expensive items that they did not actually have with them at all. Photos of damage are also regularly searched for on the Internet, with which false claims are then submitted to insurance companies.
Different types of insurance fraud
There are different forms of insurance fraud. Below are some examples of these different forms:
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Committing fraud in making an insurance application
When applying for new insurance. fraud may be involved. This is the case, for example, when incorrect information is provided. For example, an insurer always asks some questions before accepting the insurance application. Examples of these questions are whether an application has ever been refounded by an insurer and whether it has ever happened that an insurance was stopped. They also often ask if there is a criminal history and if there has ever been a driving disqualification. If these questions are not answered honestly, then insurance fraud is involved.
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Claiming more than the actual damages suffered
Fraud occurs when inaccuracies are reported when claims are reported. An example is when more items are reported after a burglary than were actually stolen. False information is provided and the damage is exaggerated so that the insurer will reimburse more.
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Distorting facts and making false claims
Another form of fraud has to do with filing false claims. Fraud occurs when, for example, a phone is reported stolen when it was simply lost. Facts are also distorted on a regular basis regarding damage, in order to ensure that the damage suffered is covered by the insurance company.
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Making conscious or creating harm
It often happens, for example, that a collision is staged or someone deliberately collides with something in order to receive money. In such cases, the insurer must prove that fraud has occurred. This is usually done by a specialist. They can soon see, for example, that a burglary is not genuine and that someone has smashed a window themselves in the hope of receiving payment. Often it can be seen that the window has been smashed from the inside instead of the outside.
The consequences of insurance fraud
Of course, there are consequences for committing fraud. For example, no compensation will be paid when it is found that fraud was committed. The costs will have to be paid entirely by yourself when, for example, a wrongful claim for burglary has been made. The insurance company is also allowed to cancel the insurance with immediate effect. This means that you will then no longer be insured. Also, you will be registered is the database of Foundation CIS as a fraudster. The data in this database are visible to all affiliated insurers, which makes taking out new insurance considerably more difficult. Moreover, the new insurance will probably require you to pay a lot more than before.
Reporting insurance fraud
If you suspect insurance fraud, you can make an (anonymous) report to the CBV (Centrum Bestrijding Verzekeringscriminaliteit). This organization offers insurers help to prevent and remedy fraud and is part of the Dutch Association of Insurers. You can easily report via the website cbv@verzekeraars.nl or by calling 070-333 85 00.
Challenging insurance fraud
Being suspected of insurance fraud can have major consequences. Not only financially, but registration as a fraudster has major consequences especially when it comes to future insurance policies. Once a decision has been made by the insurance company to file a report, criminal penalties may also follow. In doing so, registration as a fraudster will no longer go away from the system so easily. If, in your opinion, the registration is not justified, you can make the choice to challenge it. In doing so, it is often helpful to hire an attorney.
Insurance fraud penalties
Insurance fraud is being harshly punished. For example, as of the year 2016, fraudsters must pay a minimum fine of 532 euros to SODA (Service Organization Direct Liability). The costs incurred for investigations can also be recovered from the fraudsters. In addition, the insurer may also proceed to report to the police. Companies do this when there is a very high amount of fraud or organized crime.
Insurance fraud investigation
When an insurer thinks fraud is involved, it must first be able to prove it. This is why investigations are always conducted when fraud is suspected. These investigations can cost quite a bit, especially if an expert or outside investigation firm is hired. The costs will be recovered from the fraudster if it is proven that fraud actually occurred. This is because no investigation would have had to take place and no costs would have been incurred if no fraud had been committed.
The insurance fraud statute of limitations
Because fraudsters pose a high-cost opportunity for insurers, insurance fraud is certainly not taken lightly. Therefore, of all reports, a report of insurance fraud lasts the longest. The statute of limitations is approximately 8 years. During these 8 years, the report remains visible to all affiliated insurance companies.
Insurance fraud car
Auto insurance fraud is one of the most common forms of insurance fraud. If you are caught committing this form of fraud then there can be major consequences. For example, in most cases you will no longer be able to go to a regular insurer. De Vereende is one of the few insurers you can probably turn to, but the premium will be many times higher than with a regular insurer.
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