Insurance Claims Fraud

Insurance fraud costs Americans billions each year and affects policyholders, insurers, and communities alike.

Here’s what you need to know to spot common fraud tactics and protect yourself against them.

What is Insurance Fraud?

 

Insurance fraud occurs when someone intentionally deceives an insurer during the purchase of a policy or the claims process in order to receive money or benefits they are not entitled to.

 

Fraud can involve policyholders, contractors, agents, or organized fraud rings—and it ultimately increases costs for everyone.

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PROPERTY INSURANCE FRAUD


Property and Casualty insurance fraud costs consumers an estimated $45 billion each year.1 

 

Fraud can occur at many points in the insurance process. Being aware of common tactics can help you recognize warning signs and avoid situations that could put your property, finances, or personal information at risk.

 

Examples of insurance fraud:

 

  • Misrepresenting property details to obtain lower premiums.

  • Exaggerating damage to increase a claim payout.

  • Padding repair invoices to cover a deductible.

  • Filing claims for damage that did not occur.

 

COMMON TYPES OF INSURANCE FRAUD

Disaster Fraud

Contractors or individuals exploiting disaster victims by inflating repair costs or filing false claims.

Identity Theft

Using someone’s personal information to obtain insurance or file fraudulent claims.

Contractor Fraud

Contractors encouraging policyholders to sign insurance benefits over, inflating repair costs, stealing deposits, or billing for labor or materials that were never provided.

HOW TO PREVENT INSURANCE FRAUD

 

  • Report suspicious activity. Notify your insurer if something doesn’t seem right.

  • Know your policy. Understand what your policy does (and doesn’t) cover.

  • Stay informed. Learn about existing and developing insurance scams.

  • Keep documentation. Save policy details, invoices, contracts, and repair records.

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Insurance Fraud Prevention at SageSure

 

SageSure’s Special Investigations Unit (SIU) works to detect, investigate, and prevent fraud across SageSure products. Our team collaborates with policyholders, producers, and fraud prevention organizations to identify suspicious activity and protect customers from fraud schemes. 

 

If you suspect fraud, contact us via the link below.

Email Us

1. “Fraud Stats.” n.d. Coalition Against Insurance Fraud. https://insurancefraud.org/fraud-stats/.
2. Kilroy, Ashley. 2024. “Insurance Fraud Statistics 2024—Forbes Advisor.” https://www.forbes.com/advisor/insurance/fraud-statistics/.