Insurance Fraud

Insurance fraud is a dishonest act carried out to deceive an insurance company for financial gain. It includes filing false or inflated claims, misrepresenting facts to get coverage, or staging accidents to collect benefits. Insurance fraud harms both insurers and policyholders because it raises insurance costs and weakens the trust the industry depends on.

Example

A car owner deliberately sets fire to their vehicle and then files a claim, saying the fire was accidental. If the insurer pays the claim without detecting the fraud, the owner receives a payout they were not entitled to. To reduce insurance fraud, insurers use advanced analytics, data sharing, and other anti-fraud measures to detect suspicious claims and protect honest policyholders from the cost of fraudulent activity.