What qualifies for entry into the Insurance Fraud Hall of Shame?

| Jan 11, 2019 | Insurance Law

The age-old American maxim “turnabout is fair play” conveys a fairly simple idea, namely this: If you get the chance to do something, fairness dictates that I receive the same opportunity.

That principle applies in American society from the onset of play in an adolescent schoolyard. It is a common idea and accepted tenet throughout life, in contexts ranging from personal interactions to the business world.

And, notably, it is alive and well in the insurance realm.

For evidence of that, we submit the Insurance Fraud Hall of Shame. That compilation of claimants who strive to defraud insurers through bad-faith conduct is a response to decidedly one-way coverage insurers customarily receive in the media that spotlights alleged wrongdoing by industry participants in claim handling. Essentially, the Shame list is an “OK, enough is enough” response that conclusively hammers home a centrally relevant point.

That is this: Although instances of insurers’ questionable conduct do exist, the same is true on the policyholders’ side of the equation. Indeed, legions of bad-faith policyholders are caught making egregiously false claims, with some of those individuals engaging in truly brazen behavior.

The Hall of Shame list dutifully underscores that fact. It is a compendium of wrongdoers spotlighted by the Coalition Against Insurance Fraud (CAIF), and it unquestionably provides glaring evidence concerning fraud efforts that the insurance industry must protect against.

Some of the details are truly shocking. Policyholders burn down businesses on purpose (sometimes killing innocent third parties in the process). They stage fake auto accidents, reporting fictitious injuries. They murder people for insurance proceeds. They engage in massive bribery schemes.

An Insurance Journal article noting the Shame list cites the estimate that “at least $80 billion in fraudulent claims are made annually in the U.S.”