Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
A San Diego woman and her father were sentenced to jail time for their involvement in an elaborate $1.5 million insurance fraud scheme for disability benefits. Four people pleaded guilty to federal fraud charges for their roles in a staged auto accident scheme. A Bridgeport, N.J., personal injury attorney masterminded an insurance fraud scheme that included an unlicensed doctor and several chiropractors and that netted $2.5 million in settlements. The list goes on and on.
Property and casualty insurance fraud cost Americans $30 billion annually, according to the National Insurance Crime Bureau (NCIB). The total cost exceeds $120 billion annually when you include other types of insurance fraud, like health, life, and specialty insurance.
Who commits fraud?
Fraud may be committed by different parties involved in insurance transactions, such as applicants for insurance policies, policyholders, third-party claimants, and professionals who provide services and equipment to claimants.
Common frauds including padding or inflating actual claims, misrepresenting facts on insurance applications, and submitting claims for injuries or damage that never occurred. In fact, every day it seems a new scheme appears. Some of the schemes include:
Who does insurance fraud harm?
Insurance fraud is neither a victimless crime nor one that harms only the insurance industry. Insurance fraud takes a personal toll, too. Innocent people die from insurance schemes, such as staged auto accidents and arson. Fraud increases the cost of insurance for everyone, and prices for everything from groceries to retail goods rise when businesses have to pass on higher insurance costs.
For example, widespread criminal activity and abuse of Florida’s no-fault auto insurance system resulted in an additional $658 million “fraud tax” on auto insurance costs in 2011, a 7 percent increase from 2010. On a per-vehicle basis, that works out to $58 for every vehicle in Florida. Since 2009, no-fault fraud has cost Florida drivers and insurers nearly $1.3 billion.
A January 2011 study of New York’s no-fault system by the Insurance Research Council (IRC) showed that the New York City area was ripe for fraud. About one in every five no-fault claims appeared to have some element of fraud, and as many as one in three appeared to be inflated.
How can you protect yourself?
Stay alert, ask questions, and be wary of suspicious insurance transactions.
If you think you’ve been scammed, contact your state’s insurance department or the NCIB at 1-800-TEL-NICB. The NICB allows the public to submit anonymous insurance fraud and crime tips.
Loretta Worters is vice president with the Insurance Information Institute, a non-profit organization whose mission is to improve public understanding of insurance—what it is and how it works. Follow her on Twitter @LWorters.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.