4 ways insurance companies can detect insurance frauds

Insurance companies lose billions of dollars in fraud acts. There are many ways an insurance company can detect insurance scams. There are four ways insurance companies can track down people involved in fraud acts.

History of claims

The insurance company analyzes the client’s history of making claims against an insurance policy. Some companies have a limit on the number of claims before the termination period of the coverage. This helps to protect the company against risk. Many people make frequent claims. For example, if a person has already filed claims for losses due to theft in the past year, then the insurance company will analyze the details related to the claims. They will discuss the issue with the police officers to find out whether the client is telling the truth or not.

Third parties

The insurance industry gets reports of fraud from third parties who try to get the inside information about an incident. These third parties called ‘whistleblowers’ find out whether it was a fraudulent claim. If they are successful in getting back the money that was taken falsely, then the whistleblowers are awarded a portion of the money recovered.

Analysis

The insurance company analyses the claim and compares it to the others. Claims which are for certain types of insured risks fall within a particular range. If some claims are on the high side of the average are turned over to insurance investigators. They further review the case and analyze them. If the claim is high, the insurance company requires extra proof. They might also inspect the situation in person.

Surveillance

Insurance companies can monitor clients directly using surveillance cameras. This is common in cases of disability insurance claims. In this case, the client claims injuries that stop them from working. The client is asked to fill out a questionnaire when applying for benefits. In the questionnaire, the client has to document his or her daily activities that he or she can perform after the accident. The insurance company will look at the video surveillance that was installed at the client’s properties. If the mobility of the client matches with what he or she mentioned in the questionnaire, then they give them.

Insurance companies have become more alert now of these kinds of fraudulent activities. They don’t pay the money for the claim without investigating things further. If you are caught once that you have made a fraud claim, then you won’t get the insurance money, and your reputation will be ruined. So, you must be honest all the time. If you claim truthfully, you will get whatever you are eligible for.

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5 factors to consider when choosing an insurance company

An insurance company plays a significant role in securing the financial future for you and your family. So, when choosing an insurance company, you need first to trust the insurer. Then you should consider the following factors.

History

You should find out how many years the company has been in the business. You should select a company that has an established track record. You should take a look at the claim settlement ratio.

Price

You should compare the prices of various insurance companies and find out who offers the best deal. The pricing of the insurance company must complement your financial plan; it shouldn’t exceed your budget.

Size of the company

You should check out the total assets, growth ratio and market share of the company. This will tell you whether the company can fulfill your claims when you make one.

Quality of service

You should learn about the quality of service provided by the insurance company. Observe their communication skills and attitudes. See if they are prompt and patient in answering your queries. Make sure that they understand your financial situation without giving you a sales pitch.

Reviews and complaints

Check out the reviews and complaints about the company. You can look into their website for client testimonials. You can also ask someone you know who has taken an insurance policy from them.

All these factors will assist you to select the right insurance company for your need. You should take the time to decide, as you don’t want to spend your hard earned money on something that you won’t get in a time of need.