The National Insurance Crime Bureau reports: about 10% or more of property-casualty insurance claims may be fraudulent. These crimes add up to billions of dollars in fraudulent insurance claims every year. Even if you haven't suffered a direct loss, you are still a victim of insurance fraud because it causes higher insurance premiums for all of us, raising taxes, and inflating prices for consumer goods. Read about three of the most common insurance related fraud below.
Scammers can do much more than simply steal credit card numbers from discarded paper receipts; they use sophisticated computer technologies to illegally obtain your financial assets and can potentially ruin your credit history. They use this information to fraudulently obtain cash and credit, goods, services, and other property, including insurance policies. Some of their tactics include opening phony bank accounts or stealing from existing accounts, obtaining unauthorized credit cards and insurance policies, applying for car or home loans, and leasing vehicles and apartments under false names. Once your identity is compromised, it can become very costly and time consuming to restore your credit. Consider adding Identity Theft coverage to your Edison policy for only $25/year for additional peace of mind.
Be wary of a contractor offering you a "free roof" or saying, "insurance will pay for a new roof", this is one of the tactics contractors use to scam homeowners and insurance companies. Some red flags include using leftover materials from a prior job, asking for cash payments or payment in full upfront. Fraudulent contractors may not provide a copy of a contract and instead use a "verbal contract" to make promises they won't fulfill. They may also lack the proper permits and wish to avoid building inspectors, trying to get past state safety codes.
After a major storm or disaster, scam artists will try and prey on emotionally susceptible victims already under tremendous stress. Individuals will often go door-to-door in damaged neighborhoods, offering cleanup and/or repair services, and while some of these services are reputable, scammers will take advantage and ask for payments upfront or convince you to sign an AOB (assignment of benefits) form and pocket your insurance payment, leaving the damage unrepaired.
Resources to Report Fraud
If you fall victim to fraud, there are many resources to help and several ways to report fraud:
- Report any fraud or scam directly to the US Federal Trade Commission online through ReportFraud.ftc.gov
- Report fraud or suspicious activity to the National Insurance Crime Bureau by calling (800)-835-6422 (Monday through Friday 7 a.m. to 7 p.m. CST.) or using their online form on NICB.org
- Report to the state of Florida through FraudFreeFlorida.com or the Insurance Fraud Hotline at 1-800-378-0445
- Report suspicious activity and fraud to us at Edison through our Fraud Hotline at (866) 923-2920 or email us at firstname.lastname@example.org
Protect Yourself with Proper Coverage
Should you fall victim to fraud or identity theft, Edison Insurance Company is here to help. We offer identity theft expense coverage, which can be added to your homeowner's policy at a minimal cost. This coverage pays for expenses incurred because of any single identity theft or fraud discovered during the policy period up to a limit of $25,000. To learn more about our identity theft coverage, or to add it to your policy, contact your agent.