Detecting Insurance Fraud & False Claims

Insurance fraud is an increasing issue to providers and policy holders. Staged car accidents to exaggerated claims of injury, fraud can cost companies billions and result in higher premiums to the honest client. That is where insurance fraud detection enters the picture and private investigators fit in quite nicely. This article will describe how the professional investigators find the fraud, help insurance adjusters as well as provide the verification of suspicious claims.

As an insurance company, legal professional or concerned policyholder, being familiar with this process can serve to safeguard your interests.

Insurance Fraud Detection

Insurance investigations fraud detection identifies and investigates claims which are suspected to be false, exaggerated or deliberately misleading. Such investigations are done to confirm validity of the claim and ensure insurers are not financially disadvantaged. Privacy investigators are commonly contracted to carry out discrete, in-depth investigations through surveillance, background searches and interviews.

Private investigators have experience in finding the truth- in most cases, they can exceed what the internal adjusters can do.

Popular Fake Claims varieties

Insurance frauds are of various types, and being familiar with these trends assists insurance fraud detection teams in becoming alert to red flags. A few typical ones are:

• Fraudulent accidents (particularly auto insurance)
• Fraudulent workers compensation claims Injuries exaggerative
• phantom thefts (of property that one never possessed).
• Property insurance arson-for-profit.
• Multiple claims filed on various insurers- duplicated claims.

Based on strategic investigation, a private investigator will be able to distinguish a genuine claim and the one that appears to be highly staged fraud.

How Private Investigators Support Insurance Adjusters 

Insurance adjusters tend to be the ones who first spot the discrepancies in a claim. They are however constrained in their resources and time. Private investigators are an effective addition to the team of the adjuster, who has the following specialized skills:

• Surveillance: 

Observation of the claimant and his actions in order to prove the severity of the injury or inconsistency in his lifestyle.

• Witness Interviews: 

Interviewing neighbours, colleagues, or eye witnesses to confirmed reported cases.

• Background Checks: 

Researching of previous claims, suits or monetary incentives.

• Evidence Collection: 

Records of inconsistencies with the help of photos, videos, and other digitally admissible evidence in court.

Insurance adjusters can better assist them by working together with investigators and thus make a more informed decision and minimize the chances of settling fraudulent claims.

Importance of Verification 

The insurance fraud detection centers around verification. Even a suspicious assertion can pass unquestioned unless there is clear evidence to prove it. By: investigators assist in proving or refuting a claim by:

• To compare the assertion with medical records, police reports or employment statistics.
• Establishing the validity of the damage to property or personal injury.
• Finding differences between what the claimant has said and what has really happened.

Such checkup is necessary to ensure that the insurers stay fair and competitive – compensating those policyholders who are honest and charging those who seek fraud.

Real-World Example

An insurance company had hired a private investigator to confirm a workers compensation claim that occurred due to an alleged back injury. The claimant complained that he was not in a position to lift heavy items or exercise.

Upon two weeks surveillance, the investigator reported that the claimant played basketball and lifted furniture into a truck. The video record, combined with the presence in social media in which he demonstrated recent hiking trips, left no doubt as to a fake statement.

The insurer had to pay a huge amount of money as a result of investigations carried out by the private investigator; the fraudulent claim was denied.

When do you Hire a Private Investigator to Detect Insurance Fraud?

The following are the most typical situations when it is smart to employ an investigator:

• An insurance adjuster detects inconsistencies or exaggerated injuries.
• There is a pattern of dodgy claims by a claimant.
• It is absence of supporting evidence to enable a claim.
• You think there is a conspiracy among various individuals (e.g., medical professionals and claimants).
• The case relates to huge revenue loss in case of fraud establishment.

Private investigators are professionals who know how to act discretely and legally to provide information that may be admitted in court or during a settlement negotiation.

FAQs about insurance fraud

1. What can a private investigator do in detecting insurance fraud?

A private investigator helps to determine the validity of insurance claims through surveillance, interviews and background checks. Their efforts assist insurance adjusters to detect fraud and collect court admissible evidence.

2. What are the red flags of a fake insurance claim?

Inconsistent stories, absence of witnesses, exaggerated injuries, a claimant who has made several prior claims and delayed reporting are common red flags. An investigator can assist in establishing the fact that these indicators indicate the presence of real fraud.

3. Is the practice of hiring a private investigator on insurance cases legal?

And the answer is yes; it is not against the law when insurance firms or legal groups hire licensed private investigators. These specialists are guided by strict legal rules that would help them obtain all the evidence that would be admissible and acquired in an ethical manner.

Conclusion: 

Insurance fraud detection is a vital component in the insurance system integrity. Whether it is determining fraudulent assertions or assisting insurance adjusters with solid evidence, private investigators present the skill required to determine the truth. They assist insurers to make sound decisions by verifying, surveillance and legally documenting their role which in turn protects the honest client and mitigates losses.

Have you discovered a possible case of a fraudulent claim or requiring assistance with the verification of suspicious matters? Contact our licensed private investigators now. You can count on us to defend your business and bring you peace of mind through proper comprehensive investigations.