It Costs Everyone
Insurance fraud is one of the most prevalent and costly “white collar” crimes around the world. It is a big factor in the cost of insurance products and is sometimes referred to as a hidden tax in this regard because it affects everyone.
When a policyholder intentionally misrepresents material facts and circumstances to an insurance company to obtain payment that would not otherwise be made, the loss must be made up for in the future cost of premiums or the company will go out of business. Insurance fraud includes any attempt to obtain money from insurance companies by arranging a loss or accident or falsifying information on applications for insurance claims.
This crime is committed by a wide cross-section of the community and is not restricted to any gender or socio-economic group - anyone can yield to temptation, including insurance entities or industry participants themselves through overbilling, misrepresentation of services, or misappropriation of funds.
Public concern about the price of insurance has prompted the insurance industry to pay particular attention to fraud and measures to prevent it.
