Insurance fraud is an industry-wide problem that affects not only insurers, but also regular, everyday law-abiding people. It happens in all sorts of different settings — on the roads, in hospitals, in private homes and in businesses and workplaces. Criminals sometimes target unsuspecting people, and the best way to avoid being a victim is to educate yourself on common scams regarding insurance in Alberta and take proactive measures to protect yourself.
Opportunistic vs. Premeditated Insurance Fraud
The two main types of insurance fraud are opportunistic fraud and premeditated fraud. As the terms suggest, opportunistic fraud occurs when a person uses an unexpected opportunity to make a claim or undermine the system for his or her own financial gain. Premeditated fraud happens when a criminal or criminal organization sets out to commit a specific crime in order to get an insurance payout.
Here are some examples of opportunistic fraud:
- Adding pre-existing damages to an insurance claim after an auto accident
- Willfully adding to the post-collision damage a vehicle has suffered in order to generate a larger claims payout
- Claiming personal property that was not actually lost, stolen or damaged after a break-in or other incident
- Changing the facts surrounding the circumstances of the incident to favour the claimant or strengthen an otherwise weak or questionable case
- Premeditated fraud includes scenarios such as:
- Conspiring to stage a car accident or collision to get money from an insurance company
- Submitting a claim in relation to an accident or event that never actually happened (e.g. claiming valuables were stolen during a break-in that did not actually take place)
- Finding a loophole that allows a claimant to avoid paying necessary premiums
- Charging insurance companies for services that were never actually rendered
These are just some of many examples, and governments across Canada are starting to crack down in a big way.
How to Avoid Becoming a Target of Insurance Fraud
One of the biggest problems with insurance fraud is that it results in higher premiums across the board. It affects everyone who needs or purchases insurance in Canada.
Unsuspecting people are at the greatest risk of being a target for insurance fraud when they’re on the road. Staged collisions are one of the most common types of insurance fraud, but the good news is that there are specific strategies you can use to avoid being involved.
First, always be aware of your surroundings while driving, and pay close attention to what other drivers are doing. You should always:
- Be a defensive driver
- Avoid following too closely
- Evade drivers who are following you too closely
- Be mindful of the situation if another driver yield the right of way to you when it is not necessary to do so
Other Important Protective Measures and Strategies
If you’ve been involved in a collision, you need to be extra vigilant against the possibility of insurance fraud. Here are some important tips to follow after an accident:
- Always know exactly what to do immediately after an accident
- Do not follow the advice of anyone who tries to take you to an unknown auto repair shop, doctor or health professional after an accident, and report the person’s activities to your insurance company
- Compare your own account of the incident against what’s listed in the claim report, and tell your insurance provider about any discrepancies
- Do not sign a blank insurance claim form under any circumstances
Finally, be sure to notify your doctor as well as your insurance company if you’ve been in an accident. This will strengthen your case if you suffer a nagging, long-term or chronic injury that requires ongoing medical care, and you will be relying on your insurance company to pay for it.
Insurance Alberta: Great Coverage at Competitive Rates from Lane’s Insurance
Lane’s Insurance is a leading Alberta-based brokerage, helping customers find unbeatable rates on the insurance products they need for the peace of mind they deserve. In addition to outstanding customer service and excellent claims support, Lane’s Insurance offers extensive informational resources and fast, free online quotes. Visit Lane’s Insurance online today, or contact Lane’s to learn more!
