Three Common Types Of Insurance Fraud
Insurance fraud is among the most common types of fraud in New York. Often, insurance fraud is committed by people who knowingly and with the intention to defraud present false information to insurance companies in the underwriting and/or claim phase. One of the main reasons this type of fraud is prevalent is the misconception that there are never any real victims. Unfortunately, unlike what most people think, insurance fraud affects innocent individuals who are usually forced to pay high premiums after fraud incidents occur.
The penalties of insurance fraud in New York range from one to twenty-five years in prison, depending on the seriousness of the crime. Usually, the punishment a person suffers after committing an insurance fraud crime in New York depends on the value of the property obtained or intended to be obtained. There are different levels of insurance fraud crimes ranging from misdemeanors to first-degree insurance fraud. A first-degree insurance fraud crime involves committing a fraudulent insurance act and obtaining or attempting to obtain more than $1 million. Such a crime is a class B felony.
In New York, most people who attempt to commit insurance fraud get caught. After all, the insurance industry is a multi-billion industry dedicated to weeding out the truth from deceitful people. However, despite knowing that the insurance industry is always vigilant when it comes to catching fraudsters, people still try to commit insurance fraud.
There are many forms of insurance fraud. The following are three of the most common forms of insurance fraud:
This is believed to be the most common type of insurance fraud. Application fraud is to blame for many denied life insurance claims. Often, this type of insurance fraud occurs when an individual knowingly and intentionally provides untrue information on an insurance application. For example, when a person uses stolen or synthetic identities to apply for insurance, they are guilty of application fraud. Also, when a person claims their property, such as a car, is worth more than it actually is during the application process, they can be found guilty of application fraud.
It is crucial to note that application fraud does not apply to the unintentional mistakes made during the application process.
False Claims Fraud
Sometimes, people invent false claims for purposes of selfishly gaining. When you file a dishonest claim, you are guilty of false claim fraud. Examples of fraudulent actions that constitute false claims fraud include;
- Filing a claim with false information.
- Deliberately staging an injury or accident so you can be able to file a claim against another person’s insurance company.
- Filing a claim for an incident that never occurred.
- Intentionally creating damage so you can file a claim.
Faked Death Fraud
Cases of people trying to defraud insurance companies by faking their deaths are more common than people think. Faked death fraud is a form of false claim fraud, but it is highly specific. Usually, a person will fake their death, and their beneficiary will collect or try to collect the money. Upon successful collection, the beneficiary and the “dead” person will share the money. However, pulling off such a type of insurance fraud is not easy.
Contact Our NYC Insurance Fraud Attorney
If you stand accused of any of the above-discussed forms of insurance fraud or any other form of insurance fraud not discussed in this article, reach out to a skilled attorney immediately. To receive legal help, contact Mark I. Cohen, an experienced NYC white collar crime attorney, today.