Insurance fraud schemes — slip ’n’ falls, fake car accidents, etc. — have a timeless appeal for scam artists because they can lead to big payoffs. To protect your business from the premium hikes and litigation that often attend such fraud, take steps to expose insurance cheats.

Slip ’n’ fall fails

Here is how an insurance scam might play out. A woman states that she slipped on a wet sidewalk outside a business and that the fall caused injuries that, ultimately, led to a miscarriage. She claims that the business’ owner had failed to maintain the premises or warn her of any danger. The woman provides an emergency room report documenting the miscarriage and demands a $75,000 settlement.

Later, when the business’ insurance company orders the woman’s medical records directly from the hospital, there is no mention of a miscarriage. It is determined that she has falsified the report and that her claim is fraudulent.

Unfortunately, insurance companies cannot always expose false claims. This type of fraud succeeds all too often because there is no reliable evidence to disprove it.

First & best defense

A security camera system is recommended because it can help you monitor activity on your premises and capture fraud evidence. However, employees are your company’s first and best defense. Train them to respond properly to accidents by photographing the site immediately and then collecting and documenting the:

• Date, time, & location of the accident
• Name, address, phone number, & date of birth of any injured person
• Nature of injuries reported
• Names, addresses, & phone numbers of witnesses
• Weather conditions at the site (if outdoors)
• Description & chronology of the incident
• Description of any injured person’s appearance & attitude

All accidents should be reported to your company’s insurance carrier, along with any suspicious behaviors or comments employees witnessed. Also, include the warning signs of common insurance schemes in your company’s fraud prevention program. If you suspect an insurance fraud incident in your business, contact us for help.