Insurance fraud occurs when someone intentionally deceives an insurance company in order to receive payment from them. Unfortunately, this is an act that occurs too often, but, fortunately, with new measures that are being put in place, the fraudsters are being caught more and more as time progresses.
For businesses, one of the most common forms of insurance fraud is the faked accident. For instance, a person comes into your establishment, slips and falls, and they file an accident report. The next thing you know, there is a claim against you for medical expenses, as well as other damages.
What really happened was the slip and fall was staged. Either the individual spilled something on their own and slipped on it so that there would be something physical to cause the fall or placed an object in their way to trip on it. This is something that occurs every day within businesses.
Types of Insurance Fraud
The above slip and fall or trip and fall example that is above is not the only type of insurance fraud that can be committed against a business. There are some individuals who will do everything in their power to achieve a settlement, so it is important that you know how to prevent such incidents. You should also know how to identify them.
Another type of fraud is the falling object. When no one is looking, a person may pull something off of a shelf on top of themselves in order to create an injury that they can be compensated for. What's frightening is the fact the injury must be confirmed by a medical doctor for them to make their claim. They purposely hurt themselves.
When you have separate automobile coverage as a part of your general liability insurance, you will have individuals who will see your business logo on the side of a truck or company car and will stage an auto accident. This is when your employee driving the vehicle will need to record everything regarding the accident. Recording all details means identifying any discrepancies that can prove the accident was staged.
Preventing and Identifying
To prevent insurance fraud, you want to make sure you have eyes everywhere. Make sure you have cameras and/or mirrors present within your establishment. You may be surprised how many times fraudsters have been caught on tape, hurting themselves to make money. When caught on tape, they find themselves in considerable trouble rather than receiving a settlement.
If someone states that they fell due to a liquid being in the floor, look at the type of liquid. Is it something that even belongs in your establishment? For example, the substance may be an oily substance, but there would be no reason for anyone to bring it into your business and it does not belong there. Ask employees when they last passed through the area. You may be surprised at what you find out.
You can also look for "coincidences." For example, if something falls onto an individual from a certain place, perhaps it should be their upper body that is injured rather than their lower body. Fraudsters are more likely to injure their legs than an arm, their head, or their ribs.
So know what to look for and how to prevent it because you know that at some point someone is going to come into your business and try to defraud you and your insurance company. All they want is money and will risk everything to get it. You need to make sure they don't get it no matter how hard they try to make their claim legitimate.