Insurance fraud and you
Mar./Apr. 2008 California Country magazine
By John Valentine
Fraudulent insurance claims increase the average household's insurance cost by more than $300 a year.
Insurance fraud is a serious problem that affects everyone. The Coalition Against Insurance Fraud estimates that fraudulent claims increase the average household's insurance cost by more than $300 a year. Nationwide wants to prevent fraud to help you from becoming a victim. Find out what insurance fraud is, what we're doing to prevent it and how to protect yourself.
What is insurance fraud?
Insurance fraud is the second most costly white-collar crime in America, and it comes in many forms, from normally honest people bending the truth to professional, organized crime rings.
Examples of insurance fraud include:
- Giving false information on an insurance application to get coverage or a lower premium rate, such as how or where a vehicle is driven or stored.
- Inflating, or “padding,” an automobile claim to get a higher payment or cover a deductible.
- Making a false claim of stolen or damaged property or stating that items are worth more than they are on an insurance claim.
- Staged automobile accidents resulting in fake injury claims, often targeting innocent drivers and threatening their safety.
- Having someone steal or burn a car to collect insurance money or to avoid expensive repairs or payments.
Insurance fraud is in many cases a criminal offense.
What is Nationwide doing about insurance fraud?
We're serious about stopping insurance fraud. We employ the best people, technology and resources in our efforts to try to stop potential fraud. Our anti-fraud strategy includes:
- Deterring fraud before it can happen by making sure all information on applications is correct.
- Dedicating a Special Investigation Unit team specifically to fight insurance fraud.
- Providing leading-edge technology such as our donation of equipment to law enforcement agencies to help reduce auto theft.
- Investing in technology to detect potentially false claims.
- Creating partnerships with anti-fraud groups such as the National Insurance Crime Bureau and the Coalition Against Insurance Fraud, as well as law enforcement agencies and groups throughout the United States.
How to protect yourself against insurance fraud
Nationwide and the National Insurance Crime Bureau suggest a few simple steps to help you avoid becoming a victim of insurance fraud:
- Get a police report with the officer's name, even if there's only a little damage. (If the report describes damage to the other car as a nick, it's harder for criminals to intentionally damage the car later and try to collect a larger claim against your insurance policy.)
- Carry a disposable camera in your car to document any accident damage and the number of passengers in other vehicles.
- Record the details of the accident including names, addresses, license plate and driver's license numbers, witnesses or anything else that may be important.
- Avoid tailgating. Be sure there is plenty of distance between your vehicle and the one in front of you in case that car suddenly stops to cause a collision.
- Avoid people who suddenly appear at the accident scene and try to direct you to doctors and attorneys. They may be part of the criminal scheme.
- Be wary of physicians who insist you file a personal injury claim after an accident, especially if you're not hurt.
- Report the accident to your insurance company as quickly as possible and even if you aren't at fault.
Reporting and stopping fraud
If you know or suspect someone is committing insurance fraud, speak up. Call the Nationwide Fraud Hotline at 1-800-4RIPOFF (800-474-7633), available 24 hours a day, or e-mail us at RPTFRAUD@nationwide.com. Calls to the Nationwide Fraud Hotline can be anonymous.
John Valentine is director of sponsor relations for Nationwide Insurance. He can be reached at 800-552-2437 ext. 4393 or firstname.lastname@example.org.