INSURANCE FRAUD IS A CRIME
What, exactly, is insurance fraud . . . and why is it a crime?
The textbook definition is: Any act committed with the intent of fraudulently receiving payment from an insurance company. Misrepresentation or omission of material facts when applying for insurance is also considered insurance fraud.
Doesn’t that definition make us picture someone staging an auto accident, or filing a claim for stolen jewelry when, in fact, the owner sold the pieces—or never even had them in the first place? Those are obvious crimes that most of us would never consider committing.
However, even simple acts can constitute fraud, such as:
- Adding your adult child and his vehicle to your auto insurance policy when, in fact, he does not live at your residence.
- Or, if any driver residing at your address, whether a relative or not, is NOT added to your policy but has access to your insured vehicles.
- Registering a vehicle at an address that is not your primary residence
- Falsifying repair costs, on either home or auto damages.
- And any other misleading or blatantly untrue facts supplied on the application or to an adjuster.
At the very least the insured person can have a claim rejected and not paid if fraud is discovered. At the worst, the claimant is subject to both state and federal prosecution, depending on the circumstances.
What can you do to avoid this crime? Be very open and honest with your independent insurance agent and answer all her questions truthfully and completely when you are applying for auto insurance or homeowner insurance in Arizona. The agents at BIVONA INSURANCE GROUP, LLC, in Glendale, AZ, are willing to help you navigate these treacherous waters.