Inflating or creating a false insurance claim is never a good idea. Depending on the level of fraud committed, penalties can range from a hefty fine to jail time. Many make think it is a victimless crime, but insurance fraud affects everyone. According to Aviva Canada, false insurance claims cost over $1.6 billion dollars annually, even with robust anti-fraud teams in place, and that money has to come from somewhere. Unfortunately, it is usually in the form of higher insurance premiums for everyone.
Remember, it is illegal to profit off of an insurance claim in any way.
Types of Insurance Fraud
There are many different ways to create a false insurance claim. These are some of the most common that anti-fraud teams are well aware of and constantly on the lookout for.
- Claims filed after a disaster (such as flooding in a home) listing items that did not exist.
- Jewelry that is lost or stolen claimed to have a higher value than it actually did.
- Claiming an item to have been lost or stolen when it wasn’t.
- Declaring a vehicle to have been stolen when it has not been, and is perhaps hidden away in storage or on a different property or simply discarded somewhere.
- Staged car crashes do occur. Claimants may want to write off their vehicle to receive its cash value or obtain access to costly medical service they may not have otherwise been able to afford.
- Other staged car accidents may be a single driver who deliberately causes an accident by braking suddenly in order to claim whiplash injuries.
- Deliberately set home fires are not as common, but they do happen. Policy owners may remove valuable items before the fire and then claim the loss of the most expensive.
- Commercial liability fraud may occur through employers claiming injury, disease and death to members of the public or to an employee.
Prove You Are Not Committing Fraud With Photographs
After a car accident, everyone knows to take pictures of the damage to your vehicle, damage to any other vehicles, and any damage to private or public property. But it’s also important to take photos before an accident as well. You adjuster may not require them in order to process your claim, but it can greatly simplify the process to have them handy if necessary. Photos of your car prior to having been in an accident can prove its condition and make it much easier to evaluate which types of repairs are necessary.
Every year at renewal time, carry out a thorough home inventory to document any new items and any changes or upgrades you have made. Photograph everything and be sure to let your insurance provider know of any added value to your home.
For jewelry, always take numerous photos of your valuable pieces and make sure to have each appraised. Keep the appraisal documents in a safe space, such as a safety deposit box. Check the special limits of your policy for jewelry, as default limits can tend to be on the low side.
Responsibilities of Insurance Companies
Your insurance company is responsible for compensating you for reported losses according to the terms of your policy. Adjusters will review your claim along with receipts, photos, and other reported details of claim-related incidences to ensure you are reimbursed for damages within the parameters of your coverage. The kind of compensation you receive depends entirely upon the type of coverage that you purchase.
If you are unsure about the terms and conditions of your insurance policy, contact us at your insurance renewal time so we can thoroughly go through your policy with you. It’s not unusual to simply purchase the first policy that is offered without asking the right questions, and that’s what we’re here for. We can help explain the language of your policy in a way you understand so that you know exactly what you are getting, and if you are unhappy with your coverage we can renegotiate with your current company or find a new policy that better suits your requirements.
Remember, there should be no penalty for switching providers at renewal time. It’s your opportunity to make the changes you need.
Trust Lane’s For All of Your Insurance Coverage Needs
At Lane’s Insurance, we are here to assist you with all things insurance. Many mistakenly believe that all insurance brokers do is find insurance coverage for clients and then they walk away, but we pride ourselves for being advocates for our clients throughout the lifetime of their policy. This means not only finding you the very best coverage for your needs, but also being there for you is you should ever have a question that you don’t feel you are getting a clear answer for, if you need assistance with the claims process, and if you ever need documentation such as a certificate of insurance.
Contact us today at our Calgary, Edmonton, Banff, and Alberta offices.