Is there a kind of fraud I have not mentioned before?
I have often written about fraud in general and fraudulent insurance claims in particular. There is one type I have so far omitted to mention. I thought of this when reading a post by Barry Zelma in his insurance fraud letter, which is the source of a lot of useful and entertaining information.
Businessmen defraud insurers!
Barry points out that some businessmen give false information to their insurers in order to reduce their premiums. This can include the total number of employees, the nature of the work (to understate the risk) and total turnover.
The fraudulent reductions in premiums can easily amount to many times more than the amount a claimant would get in a typical personal injury claim. Tens or even hundreds of thousands compared with a few thousand.
Are insurers are the only victims of this kind of fraud?
Perhaps you think this does not affect you, whereas a fraudulent claim against your business obviously would. Think again! The insurance companies must recoup their losses somehow. Guess! Yes, it’s our premiums.
The other victims of this kind of fraud are genuine claimants (they do exist!) who find the insurers refuse to pay their claims and either lose out completely or have to drag the money out of the business by a time-and-energy-consuming court case.
I hope you are not among the perpetrators of such frauds. Play fair!