5 most common types of insurance frauds

It is now very normal for people to cheat insurance companies out of money. It is estimated that insurance companies lose about $30 billion per year for insurance fraud costs. Here are the most common types of insurance frauds.

Stolen Car


There are two types of fraudulent activities involved in the case of stolen cars. First, the car owner can sell his or her car to a body shop and ask them to cut up the parts and file a claim for a stolen car. Another way is to sell the car to oversees buyers with a paperless transaction and then reporting it as being stolen.

Car Accident


The driver and the victim team up and set the stage. Sometimes even the insurance investigators become also part of the game. The payoff is huge, especially when the accident involves two cars.

Car Damage


People report a small car accident and get their claims for the damages, but never repairs the car. This type of incidents is frequently happening. The insurance company has to lose a lot of money for this.

Health Insurance Billing Fraud


The health care professionals also get involved in the fraud act. They bill insurance companies a high fee for a normal procedure or bill for services that the patient never rendered.

Fake Home Fires


A common form of homeowners insurance fraud is a staging a fake fire. The homeowner removes the important belongings before the fire. In every case, the homeowner doesn’t stay at home when the fire occurs. A criminal is hired to do the job.

Some of these activities are a criminal offense. If you are caught, you will serve many years in jail and have to pay a lot of money in compensation. So, never get involved in such act.