False insurance claims
Encyclopedia
Insurance fraud or false insurance claims are insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...

 claims filed with the intent to defraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...

 an insurance provider.

Health insurance fraud

Health insurance fraud is described as an intentional act of deceiving, concealing, or misrepresenting information that results in health care benefits being paid to an individual or group.

Fraud can be committed by both a member and a provider. Member fraud consists of ineligible members and/or dependents, alterations on enrollment forms, concealing pre-existing conditions, failure to report other coverage, prescription drug
Prescription drug
A prescription medication is a licensed medicine that is regulated by legislation to require a medical prescription before it can be obtained. The term is used to distinguish it from over-the-counter drugs which can be obtained without a prescription...

 fraud, and failure to disclose claims that were a result of a work related injury. Provider fraud consists of claims submitted by bogus physicians, billing for services not rendered, billing for higher level of services, diagnosis
Medical diagnosis
Medical diagnosis refers both to the process of attempting to determine or identify a possible disease or disorder , and to the opinion reached by this process...

 or treatments that are outside the scope of practice, alterations on claims submissions, and providing services while under suspension or when license have been revoked. Independent medical examinations are used to debunk false insurance claims and allow the insurance company or claimant to seek a non-partial medical view for injury related cases.

In response to the increased amount of health care fraud in the United States, Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....

, through the Health Insurance Portability and Accountability Act
Health Insurance Portability and Accountability Act
The Health Insurance Portability and Accountability Act of 1996 was enacted by the U.S. Congress and signed by President Bill Clinton in 1996. It was originally sponsored by Sen. Edward Kennedy and Sen. Nancy Kassebaum . Title I of HIPAA protects health insurance coverage for workers and their...

 of 1996 (HIPAA), has specifically established health care fraud as a federal criminal offense with punishment of up to ten years of prison in addition to significant financial penalties.

Auto (or Motor) insurance fraud

Globally, one of the largest categories of insurance claims fraud revolves around the insurance of vehicles. There are a number of modus operandi
Modus operandi
Modus operandi is a Latin phrase, approximately translated as "mode of operation". The term is used to describe someone's habits or manner of working, their method of operating or functioning...

:

Staged collisions

This rapidly growing category involves staging a collision where the fraudsters will use a vehicle to stage an accident with the innocent party. Typically, there would be 4 or 5 fraudsters in the vehicle which makes an unexpected manoeuvre causing the innocent party to collide with the fraudsters vehicle. Each of the fraudsters then claim for injuries sustained in the vehicle. Working with a “recruited” doctor, the injuries are typically whiplash or other soft tissue injuries which are hard to dispute later.

Exaggerated claims

A real accident may occur, but the dishonest owner may take the opportunity to incorporate a whole range of previous minor damage to the vehicle into the garage bill associated with the real accident.

Examples

Some memorable examples of insurance fraud include the following:
  • Former British Government minister John Stonehouse went missing in 1974 from a beach in Miami. He was discovered living under an assumed name in Australia
    Australia
    Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

    , extradited to Britain and jailed for seven years for fraud, theft and forgery.
  • John Magno
    John Magno
    John Magno is a Toronto businessman who is currently awaiting trial for arson, allegedly for insurance fraud....

     allegedly hired accomplices to set fire
    Arson
    Arson is the crime of intentionally or maliciously setting fire to structures or wildland areas. It may be distinguished from other causes such as spontaneous combustion and natural wildfires...

     to his Toronto, Canada hardware store in order to collect insurance money.

External links

The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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