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How Insurance Fraud is Costing Everyone
Author: Dominick Steadman
1. What the heck is an insurance con anyway?
An insurance con is produced when benefits are got from an insurance company after staging dishonest information. A typical example of a scam is when a false accident is reported or a person pretends to have lost an item. To raise the chances of gaining from an insurance claim, some people may decide lie about some of the facts presented.
2. Is it actually essential to be troubled by fraudulent activities in insurance?
Of course we may be concerned.We will all pay higher premiums if insurance business enterprises lose funds to dishonest actions.Premiums are more expensive if the risk of losing money through fraudulent activities is high.
When premiums are high-priced, business organizations end up paying high commercial and health insurance costs.Consumer goods and services are sold at increased prices because the higher insurance costs are handed on to the customer. What this means is that business organizations are directly losing tens of millions of dollars annually to fraud and we are all someways diffusely losing money too.
Funds is invested in financial organizations like banks by insurance businesses.To some degree, there is a general reduction in economic activity when vital institutions such as insurance institutions lose cash, because less funds will be forthcoming for investment.
When fraudsters arrange unreal accidents or sell fake health insurances, they will endanger individuals' lives and health. Innocent people may be injured or sometimes killed when people try to arrange a misleading accident. Similarly,an arson attack may end up in the death of a person or animals.A deceiver can seek to profit from life insurance money by murdering people or killing animals.
3. Since we acknowledge that insurance fraudulent activities are real why are we not eradicating it?
We can look at different reasons. Insurance fraudulent activities are reckoned as low risk criminal acts because at times it is very difficult to determine if it is done only once by the scammer. Some instances of fraudulent activities are determined if the perpetrator repeats the same crime or if the deceptive activity is similar to other recorded insurance fraud crimes.
Compared to crimes related to alcohol and drug-related substances, it is interesting to acknowledge that a small priority is given to fraudulent activities by law enforcement agencies. Insurance crimes are reckoned to be too complicated to be successfully prosecuted, and this has resulted in them being given a low legal precedence by prosecutors.It is a known fact that fraudsters can profit from unclear states of affairs since they can exploit deficiencies within the systems.
Sometimes it is reckoned to be a waste of time to challenge small deceptive claims by the insurance commercial enterprises. If the amounts of money involved are large the insurance companies tend to acknowledge.
Now, the initial issue to prohibit fraud is to ensure that people is knowledgeable of it. The second point is the capacity to discover dishonest activity. Assisting individuals to contact law enforcement agencies is crucial.
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