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Insurance Fraud: The Impact of Fraud and How to Report It

Insurance Fraud Photo

By Madeline Klein on October 22, 2021 in Insurance Basics

As an auto insurance company, our whole purpose is to keep drivers and their vehicles protected from whatever mishaps or dangers they may encounter on the road—and that includes car insurance fraud. Any time someone tries to deceive an insurance company to get some extra money in their pocket, they hurt both the insurance company and every driver that insurance company insures.

At Say Insurance, we’re committed to our drivers and take insurance fraud very seriously. If you suspect you or someone else has been taken advantage of in an insurance fraud scheme, report it right away.

What is insurance fraud?

Insurance fraud is any act falsifying or exaggerating the facts or damages of any claim to an insurance company to obtain payment that is not otherwise owed. Here are some common types of insurance fraud:

  • Staged auto or slip-and-fall accidents
  • Faked or inflated auto, home, or business losses
  • Intentional fires to burn any property
  • Phony or inflated personal property losses
  • Phony or inflated medical bills
  • Phony or inflated repair bills
  • Exaggerated injuries or misrepresenting the ability to work
  • Questionable death or disability for Life Insurance

How does it affect me?

Insurance fraud is wrong, and it's a crime. It costs everyone, even our Say Insurance customers. Reports from Coalition Against Insurance Fraud suggest, “Insurance fraud steals at least $80 billion every year from American consumers.” This can lead to increased insurance premiums.

Long story short: Insurance fraudsters inflate the costs of claims. The more an insurance company pays for claims, the more premium it has to charge to cover those claims. So fraud unfairly costs our policyholders.

To report suspected fraud:

At any time you can:

What information is needed?

When it comes to a fraud investigation, the more information you can provide, the better. We’ll ask for:

  • Your name (You may remain anonymous, but it almost always helps us investigate if we can contact you again. We will keep your identity confidential.)
  • Name of the person suspected of fraud and any contact information you know
  • As much detail as possible about why you believe they are committing fraud
  • Any information that will help us identify the auto claim (i.e. claim number)
  • Your phone number or email address if you allow us to contact you

What happens after I report the suspected fraud?

Our Special Investigations Unit will investigate all reports of suspected insurance fraud. If you allow us, we may contact you for more information.

What is our Special Investigation Unit?

Our Special Investigation Unit (SIU) helps us identify, investigate, deter, and defeat insurance fraud by:

  • Investigating potential fraudulent activity. Our SIU closely examines suspicious claims for evidence of fraud.
  • Cooperating with law enforcement when they pursue and prosecute fraudsters to help stop their fraud.
  • Educating our claim representatives to look for fraud indicators in claims. Our SIU keeps them up to date on the latest fraud schemes so they know to be on the lookout.

What happens if you’re suspected of fraud?

Because insurance fraud is a crime in every state, there can be consequences no matter where you are. In some instances, insurance fraud is even a federal crime.

Say is required to report all suspected fraud to the local authorities, usually the Department of Insurance through the National Insurance Crime Bureau (NICB). Or, in some cases, we may also have to alert law enforcement authorities.

Once fraud is reported, it's often investigated by either the Department of Insurance or local and federal authorities. They often will prosecute someone committing fraud if needed.

How can I protect myself and family?

If you are in an auto accident, be aware:

  • Call the police and beware of anyone who is anxious to quickly leave.
  • List names, addresses, license plate numbers, witness information, and anything else that might later be important.
  • Take pictures of all vehicles and the accident scene—but only if you can do so safely.
  • Record the number of occupants in each vehicle. Watch for large, older vehicles because fraudsters often crowd into these cars when they intend to stage an accident.
  • Don’t tailgate—even if you are not in an accident, watch for people who brake for no apparent reason. Some fraudsters will do this to intentionally cause accidents.

Say Insurance is committed to fight fraud, and you can help. If you suspect any insurance fraud, please report it to us ASAP.

Madeline Klein is Say's Digital Content Producer. She graduated from the University of Missouri with a Bachelor of Journalism, emphasis in Strategic Communication. Her experience is in writing and digital media. Madeline loves using her creativity to write and design new and exciting pieces of work for Say!