Different Insurance Fraud Detection Techniques
Eliminating insurance fraud is likely never going to happen. Criminals are coming up with new techniques to cheat insurance companies out of money all the time. As one method of insurance fraud is detected, they graduate to more sophisticated ideas. Almost every insurance company has insurance fraud detection specialists who are trained to recognize any inconsistencies in the claims that are made.
Every insurance company has their own set of detection techniques but a common one is to flag clients who make large claims regularly. How this works is very simple. Each time someone claims on their policy, a number is placed next to their name. As the claims increase, so does the number.
At a certain point, the insurance fraud detection specialists give more credence to the idea that fraud is taking place and they investigate the claim in detail.
Some red flags immediately jump out to those who are trained to detect insurance fraud. One is a suspicious claim for an automobile accident. If the person who is reporting the accident has a wildly different story than the other person who was involved, this may suggest that fraud is taking place.
One very common type of insurance fraud that focuses on automobiles is when an insurer is in a minor accident and then creates more damage so they can also claim for injuries. Gathering statements and locating witnesses are often the detection techniques used in this case.
In terms of disability and health insurance, the detection techniques are typically the same. If someone is suspected of cheating either their health insurance or workers’ compensation out of disability claim money, an investigation will be launched. One of the most effective methods to detect insurance fraud in these types of cases is by watching the insured.
It may seem an expensive endeavor to have an investigator following a claimant, but if there is the reason to believe they can do physical activities they claim they can’t, the time spent is well worth it. In this type of case, the investigator will try and secure either photographic or video evidence of the individual performing tasks they claimed they couldn’t.
Arson investigators are often called to help detect insurance fraud as well. If someone is believed to be involved in burning down their property to benefit financially, this will usually be thoroughly investigated on all angles.
Not only will an arson investigator work to determine what caused the fire, but anyone close to the person suspected of insurance fraud will be questioned at length as well.
Insurance companies need to protect their interests and with the proper fraud detection techniques, they can do just that. For each case they prove as fraud, they end up saving their company a lot of money.
What Does An Insurance Fraud Investigator Do?
Not all insurance claims are valid and when an insurance company suspects that something is amiss they have an insurance fraud investigator take a look. These individuals are trained to look at a claim and investigate whether or not it’s legitimate.
These investigators work in every realm of the insurance world including auto insurance, health care fraud investigation as well as in the area of an arson investigator. This is a challenging and interesting position.
One of the key areas that an insurance fraud investigator focuses on is the background and claim’s history of the person filing the claim. Some people have a history of filing insurance claims and then once they’ve been settled, they move to another insurance company.
A highly skilled insurance fraud investigator will look into a person’s history and determine if they pose a risk for dishonest activity. Often, a person who has been convicted of insurance fraud will use a fake identity to take out a new insurance policy. Insurance fraud investigators search for this kind of activity as well.
Besides they take a hands-on approach when they suspect a claim has been filed that isn’t genuine. This part of a fraud investigator’s job often involves a lot of time spent out of the office, interviewing and gathering evidence.
In the case of an auto collision where the company suspects illegal activity is taking place, the investigator will attempt to contact witnesses and also take photographs of the vehicles that were involved as well as the intersection.
Another tool that many fraud investigators use is to determine the weather the night of the incident to see if it played a part and also to see if the claimant can recall it. If he or she can’t this may be an indication of deception.
A health care fraud investigation is often a detailed and extensive process. Many people go on long term disability benefits. This means the insurance company has to pay out a lot of money in ongoing claims. If there is any doubt about the legitimacy of the claim, the insurance company will put an insurance fraud investigator to use.
In a case like this, the investigator will not only interview the person who filed the claim but may also speak with their friends and neighbors. One of the ways that health care fraud investigation is undertaken is by following the claimant and documenting any activity that appears to contradict the claim.
There is a lot of responsibility placed on an insurance fraud investigator. They are often placed in difficult situations in which they must use their intelligence and intuition to determine whether someone is telling the truth or not. Insurance fraud investigators are often solely responsible for saving an insurance company a considerable amount of money.
What Are The Most Lucrative Insurance Fraud Jobs?
If you’ve ever been the victim of insurance fraud, then you already know how valuable it would have been, had an insurance fraud professional gotten involved. With the onslaught of new and sophisticated techniques in insurance fraud, insurance companies are recognizing the need for qualified individuals to fill insurance fraud jobs. Several different jobs fall under this umbrella.
An insurance fraud detective sounds like a career choice that is filled with mystery and intrigue, and it is. A person who investigates insurance fraud does so to save the company they represent money.
Every day bogus claims are filed in all areas of the insurance industry. Although some insurance fraud investigators do work in different areas, most specialize in one type of investigation.
It may be automobile insurance fraud or perhaps health insurance fraud. The detective is the person who gathers all the necessary information, be it physical evidence or interviews. They then take everything and decide as to whether or not the claim is justified.
Much like a detective, an insurance fraud examiner also goes out and gathers together much-needed information. An examiner may also investigate the history of the claimant by using personal information including their career history as well as their Social Security Number.
An insurance examiner in the field of automotive insurance may also visit the scene of the accident, taking pictures and measurements, to determine if the collision could have occurred the way the claimant suggests.
In both cases, of an insurance fraud detective or an examiner, they may also be required to present evidence in a court of law. Many insurance fraud cases end up in court and the examiner is the person called on to testify about what they discovered. For this reason, it’s incredibly important for anyone holding either of these positions to be fully trained.
Lawyers can also choose a career in insurance fraud. There are two different sides to the attorney coin when it comes to insurance fraud. One is to represent individuals who have been accused of fraudulent activity concerning an insurance claim.
The other position that appeals to some attorneys interested in insurance fraud jobs is to represent insurance companies. This can be a high paced very rewarding position for an attorney who thoroughly understands every aspect of insurance fraud. Being an insurance fraud attorney is a great career option in this industry.
To pursue one of these insurance fraud careers, an individual has to have great intuition and be able to weigh all the evidence to reach a fair determination. It is not a job for everyone, but for those interested in the insurance industry, it is a great career path to pursue.
It’s also an industry that is likely to be around for many years. As much as insurance companies work diligently to combat fraud, it remains an ever-increasing problem.
The Responsibilities Of An Insurance Fraud Lawyer
When a person is accused of insurance fraud, it can be a devastating experience. This is particularly true if they feel they haven’t done anything wrong. For someone in this position, hiring an insurance fraud lawyer is the only real choice. These attorneys have specific knowledge about insurance fraud and can defend anyone accused of this crime.
Finding an insurance fraud lawyer isn’t terribly difficult. Many attorneys in almost every city have a thorough understanding of how insurance fraud works. It’s incredibly important to retain a lawyer early in the process so they can give you all the advice you need. If you are being investigated for insurance fraud and have not yet been charged, retaining an attorney is a great idea.
Once you’ve retained an attorney he or she will want to discuss in detail what the claim was for and why you are being accused of fraudulent activity. The best way to defend yourself is to always be honest and this includes with your attorney. If you have kept documented evidence of all correspondence with the insurance company, give this to your insurance fraud attorney.
In addition to helping individuals who have been accused of insurance fraud, these attorneys also take on cases where a person feels they have been the victim of insurance fraud. There are instances when an insurance agent acts in bad faith to convince someone that they need a policy that is beyond the coverage level they require.
If a person feels as though they’ve been a victim of this type of behavior they should consult with a lawyer who will explain their rights.
One group of people seems to fall victim to these types of scams more than others and that’s elderly. Insurance agents often see mature individuals as being gullible and as such they will try and sell them plans that are beyond their means while telling them that the coverage the plan supplies is crucial.
The largest problem with these types of scenarios is that the elderly individual knowingly agrees to the expensive policy because they feel they have little choice. This type of insurance fraud can result in a person buying extra health, life or automobile insurance.
If this does happen and someone close to the elderly person realizes, they can take the step of contacting the health care fraud attorney themselves to explain what happened.
Although you can certainly hire any lawyer to defend or represent you in an insurance fraud case it’s important to choose an attorney who understands all aspects of the insurance industry. The reason is simple, you want someone on your side who is the best qualified for the job.
What Is Involved In Insurance Fraud Training?
As insurance fraud grows, the number of qualified individuals required to investigate claims has also increased. Many people are now realizing that there is a career in insurance fraud. This is one of the reasons insurance fraud training courses are as popular as they are. As those who commit insurance fraud become more sophisticated, insurance fraud training techniques change constantly as well.
Insurance adjusters are typically the ones who investigate questionable claims. The insurance adjuster is the person who goes out after an auto accident to gather information before deciding if their client is at fault or not. Every type of insurance has insurance adjusters whose job it is to validate claims before they can be paid.
When it comes to insurance adjuster training, adjusters are taught how to identify claims that may fall into the fraudulent guidelines. They are then given techniques to use to investigate the claim and the claimant.
Although all insurance companies have adjusters on staff, not all companies require claims fraud training of those adjustors. Some hire outside staff that works on a consultation basis investigating insurance fraud. This is a more expensive approach to fraud investigation but some companies feel the extra cost is justified.
The type of training that is involved varies depending on the area of insurance that is being dealt with. Some aspects of training are common regardless of the specific type of insurance and that is investigating the claimant.
During fraud training classes the students are instructed on how to do this by checking the background of the claimant as well as what, if any other, claims they have made.
In terms of health insurance fraud or workers’ compensation fraud, individuals undergoing claims fraud training are taught how to ensure a claim is legitimate. This involves reviewing medical records as well as speaking to the claimant as well as others they are close to.
One investigative technique that is often used in the areas of health and workers’ compensation claims involves surveillance on the claimant. If there has been a report of the claimant performing tasks that medically they can’t, the investigator may have to follow the claimant and either photograph or videotape them.
A good deal of the time spent being an insurance fraud investigator is interviewing others. For this reason, training also typically involves interviewing techniques as well as learning how to read deception in the behavior of others.
The main point of any insurance fraud training is to be able to distinguish between the truth and a lie. Many insurance fraud investigators can take a whole host of information and use that to determine whether a claim should be put through or not. It’s an exciting and interesting job.
The Best Ways For Reporting Insurance Fraud
Everyone must report suspicious activity to the authorities. This activity should include insurance fraud. There are thousands of cases of insurance fraud taking place each day and the average citizen needs to be aware of what they can do personally to fight this ever-growing problem. When it comes to reporting insurance fraud all of us are responsible.
To understand how to report insurance fraud, a person must first realize what insurance fraud is. Many different types of fraud involve different types of insurance so it’s essential to know what you are looking for. If you even suspect a co-worker, neighbor or relative is taking part in fraudulent activity related to an insurance claim, it’s your duty to report it.
One of the most common forms of insurance fraud falls within the automobile insurance industry. Staged car accidents are a very popular type of auto insurance fraud and if you witness an accident like this you need to get in contact with the victim.
In most cases of staged motor vehicle accidents, two cars work in tandem to set up an accident. If you notice this happening, pull over and offer your name and number to the victim. This can help them when it comes time to deal with their insurance company.
Health insurance fraud is on the rise and more and more people are becoming aware of what to look for if they suspect someone is taking part in this.
If you have a neighbor or friend who has told you that they aren’t working because they are collecting disability or workers’ compensation benefits and you notice them lifting heavy things or working briskly around their yard, this may be a case of insurance fraud.
Although you may feel guilty reporting insurance fraud that you suspect an acquaintance of taking part in, it is illegal and it must be reported.
Staged fires are also a form of insurance fraud and it’s often the people who live or work in adjacent buildings that are the first to notice something suspicious.
If you overhear someone complaining about debt or discussing fires and then their property goes up in flames, you should report this behavior. In many cases, insurance fraud cases are solved because of assistance from average citizens.
Every state has its insurance fraud hotline that puts the average citizen in touch with individuals who can anonymously take their information and listen to their concerns. There is also a national insurance fraud hotline which is 1-800-A-FRAUD.
Calling this number do report anything suspicious that is related to insurance could result in thousands of dollars of saved claims.
Read also: Understanding Gap Insurance and How it Works