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The Art of Detection: Investigating Insurance Fraud Claims

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The Art of Detection: Investigating Insurance Fraud Claims

Insurance fraud is a major issue that has a detrimental effect on both insurance companies and policyholders. Fraudulent claims can cause insurance premiums to skyrocket, leading to substantial financial losses for insurers. To prevent being defrauded, insurance companies often launch investigations to identify any suspicious activity. 

These investigations can involve reviewing documentation, interviewing witnesses, and examining other evidence to determine if fraud has taken place. Through these efforts, insurance companies can take steps to reduce fraud and protect their customers from financial losses.

In this article, we will explore some of the common types of insurance fraud and how investigations can help detect and prevent fraudulent claims.

Surveillance for Workers’ Compensation Fraud (WSIB – WCB)

Workers’ compensation fraud occurs when employees make false claims of having sustained an injury while at work. Insurance investigators can use surveillance methods to verify the legitimacy of injury claims. This can include keeping track of the employee’s activities to see if they are engaging in physical activity that is not in line with the reported injury. 

Such activities may include playing sports, working in other places, or engaging in strenuous physical activity. Surveillance may also involve the use of cameras or other recording devices to monitor the employee’s activities. If the surveillance reveals that the employee is engaging in activities that are inconsistent with their injury claim, then the insurance company can investigate further to determine if there is sufficient evidence to deny the claim.

Surveillance in a worker’s compensation situation will vary case by case. However, when our private investigators conduct surveillance, we recommend at minimum three days of consecutive surveillance with the days being at least 12 hours in duration. This way, we can determine what the subject’s activities are and if the limitations and restrictions they have claimed match the actions they are doing. 

How to Investigate Disability Fraud

Disability fraud occurs when an individual falsely claims to have a disability to receive disability benefits. In the case of disability fraud, private investigators would not deal with this. However, Investigators from the government, for instance, can verify the individual’s medical records and conduct surveillance to determine whether they are engaging in activities that are inconsistent with their claimed disability.

How to Investigate Insurance Fraud

Insurance fraud can take many forms, including fraudulent claims, staged accidents, and fake injuries. Investigators can use a variety of methods to investigate insurance fraud, including interviewing witnesses, reviewing medical records, and conducting surveillance.

Investigating insurance claims can be entertaining, to say the least, for private investigators. It can be shocking the lengths that some will go to in order to defraud the system. One case, in particular, our founder and CEO was on was a very standard insurance case. The subject had a large covered front porch with a mirror that faced the roadway. 

The angle our investigator was on allowed us to see the subject every day we were there get ready by placing bandages on his head (there was not a head injury), placing a brace on his neck (no neck injury) and using a cane which was not something he would have needed based on the injuries listed. This individual, however, was not using any of these devices while in the house, yard, etc. Only when he leaves would he put this “outfit” together of medical devices. 

Investigating Health Insurance Fraud

Health insurance fraud can involve false claims for medical treatment, fake prescriptions, and billing for services that were not provided. Investigators specifically that work for hospitals and insurance companies deal with this as they can review medical records, conduct interviews with healthcare providers and patients, and review billing records to uncover fraudulent activity.

Insurance Scams and Fraudulent Claims

Insurance fraud is prevalent and costs the insurance industry billions of dollars each year. Insurance scams can take many forms, including fake accidents in Toronto, fake injuries in Vancouver, and staged collisions. Some fraudsters go to great lengths to create fake accidents and injuries, while others exaggerate their claims. Auto insurers are particularly vulnerable to fraud, as the cost of repairs and medical expenses can quickly add up.

Auto Insurance Fraud Investigations

Auto insurance fraud is a common form of insurance fraud that can involve staged accidents, fake injuries, and fraudulent claims for vehicle damage. Auto insurance companies may use a variety of methods to investigate claims, including reviewing accident reports, conducting interviews with witnesses, and reviewing surveillance footage.

In major cities within Canada, such as Vancouver, Calgary, Edmonton, Regina, Winnipeg, Toronto, Ottawa, Montreal, Fredericton and Halifax, you see increased fraud. One of the most recent types of accident fraud was individuals removing the bulb on their reverse so that when they backed up and hit someone, they could claim the person ran into them. 

This would confuse the driver, who would think they did hit the suspect. However, the suspect backed into them, usually in a high-traffic situation and then claimed the person hit them. Usually, they are trying to get cash on-site rather than go through insurance. However, this is one example of auto insurance fraud in Canada. 

How to Report Suspected Insurance Fraud

If you suspect fraud, it is important to report it to your insurance company immediately. Most insurance companies have a fraud hotline or online reporting system that you can use to report suspicious activity. You can also report suspected fraud to law enforcement agencies, such as the police or the Insurance Bureau of Canada.

How to Investigate Auto Insurance Fraud

Auto insurance fraud can involve staged accidents, fake injuries, and fraudulent claims for vehicle damage. Investigators can review accident reports, interview witnesses, and conduct surveillance to determine whether the claim is legitimate.

Investigating Medical Billing Fraud

Medical billing fraud can involve overbilling for services, billing for services that were not provided, and submitting claims for unnecessary procedures. Investigators can review medical records, conduct interviews with healthcare providers and patients, and review billing records to uncover fraudulent activity. This is not a service that private investigators complete. 

Insurance Fraud Investigator Job Description

Insurance fraud investigators in Ontario are responsible for conducting investigations into fraudulent insurance claims. They may work for insurance companies, law enforcement agencies, or private investigation firms. Their duties may include reviewing medical records, conducting interviews with witnesses, and conducting surveillance.

How to Defend Against Insurance Fraud Allegations

If you are accused of insurance fraud, it is important to hire an attorney who specializes in insurance fraud defence. Your attorney can review the evidence against you and develop a defence strategy to protect your rights and reputation.

In Conclusion

Insurance crime is a serious problem that affects everyone in the insurance industry. By conducting thorough anti-fraud investigations and working with law enforcement, insurance companies can detect and prevent fraudulent activity. If you suspect insurance fraud, it is important to report it immediately to help protect against further fraudulent activity.

If you need to hire a private investigator to conduct surveillance in a matter you believe is suspicious, call today for a free consultation or complete an inquiry form below and one of our customer service representatives will contact you. 

About the Author

Whitney Joy Smith

Founder of The Smith Investigation Agency in 2014, Whitney Joy Smith’s extensive background as a private investigator is matched only by her passion for the role. A graduate of several respected institutions, including Northwest Florida State College and George Brown College, her early years in life were spent between Canada and the United States. This education, along with her formative years as a private investigator in various agencies, informed much of her knowledge of private investigative laws, regulations, and operating standards in both countries.

The recipient of numerous industry awards and accolades, including the Consumers Choice Award, Best in Ottawa, and many others, Whitney takes pride in working closely with her ever-growing agency to raise the bar, maintain compliance, and meet the investigative needs of clients. Whitney is active in various membership and supporting roles, including the CPIRC, CBN, CAPI, Canadian Women’s Chamber of Commerce, and many others. Her experience-driven, thought-provoking articles have been featured in everything from Readers Digest to Business News Daily, and she strives to continually redefine standards for those in the private investigative and security fields. Learn more about Whitney and the team at The Smith Investigation Agency today.

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