Insurance Fraud | CoupleWealth
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Insurance fraud is a big issue that often has to be dealt with instantly, not to have severe consequences soon. There are mainly two types of insurance fraud.

  1. Fraud by the insurance company itself, an insurance agent, or an independent.
  2. The second one is when the customer is fraudulent against an insurance company or government insurance company.

Each type of insurance has a different reporting technique and is often required to follow specific steps to resolve it. Nevertheless, before we get into reporting to the National Insurance Crime Bureau (NICB), you need to get acquainted with different strategies people use in committing fraud.

Insurance fraud can happen anywhere regardless of what aspect you are looking at, so one needs to be aware of what is going on. In short, be on top of the situation.

Exposed Insurance Fraud Strategies

According to the FBI, there is insurance fraud worth over $40 billion annually. This stat is not to scare you because insurances are a lifesaver at the end of the day, and everyone needs them to help them in their lives.

1. Car Insurance Fraud

There are three categories within this, yes, I know! Yes, it is super common! Car fraud is one of the most common types of fraud committed, and people well get away with it quite often.

In the first category of car fraud, we have “Car Accident Insurance Fraud.” This refers to a staged accident that involves two sets of drivers who have decided to commit the fraud so that they can take advantage of insurance companies.

Next, we have “Car Theft Insurance Fraud.” This is one of the smartest ways to get away with some outrageous stuff. In this case, the owner often reports their car stolen despite selling it without any paperwork outside the country.

In our last and final category, we have “Car Damage Insurance Fraud.” In this particular case, owners usually overestimate the cost for the damages done in conjunction with the repairer who is happily involved because of the insurance check.

2. Health Insurance Fraud

This type of fraud happens when your health care provider (this includes doctor checkup and more) charges you an excessive amount for a low-cost procedure or in most cases services which have not been provided for.

For example, if you went in for a regular checkup, which costs almost nothing, your doctor charges $40,000 even though the medical procedures or services paid for were not provided or not needed.

This is one reason why one needs to be vigilant with their insurances or loans, for that matter. In many cases, doctors also ask you to perform specific tests that are entirely unnecessary and not needed, so it is essential to exercise caution in every case.

3. Faking a Death

Nope, Sherlock Holmes is not the only one who can and does it! I guess we all have an inner Sherlock Holmes waiting to be released!

So, what happens here is that people often get their life insurance policies and make one of their family members a beneficiary. For the life insurance to come into effect, it usually takes a couple of months. After which, the owner fakes his death. Check out my life insurance article to understand better.

Reading this, it does seem like something out of the movies. Maybe people are trying to become them.

4. Vandalism Insurance Fraud

Believe it or not, this is one of the most common types of home insurance fraud, including fire or vandalism.

Most people hire people or criminals to break into their house, vandalize or set their house on fire. They try to portray themselves as victimized and innocent, but that does not go without saying that they remove essential items from their houses (a smart way of catching them red-handed).

5. Insurance Premium Fraud

Another common type of fraud is when insurance premiums are embezzled. This often happens when the insurance agent asks or collects premiums from you, but he keeps it for himself.

Unfortunately, consumers keep paying “premiums” to a said agent without knowing what is going on. This type also comes with fake policies that may or may not be provided by specific individuals, so it is essential to do your research before opting for an insurance plan.

Ways To Report Insurance Fraud

1. Gather the Facts

To prove insurance fraud, you have to provide the facts with all the appropriate information concerning fraudulent activity. Agencies are often super busy and may take your application lightly; to avoid that, you should provide proper documentation.

2. Call Your Insurance Company

If you think you are a victim of insurance fraud, call up your insurance company. Most insurance companies have a small department within, like the anti-fraud department, which deals with fraudulent activities that you may want to report. This is one of the main things you should go ahead and do by informing your insurance company about what happened.

3. Contact The National Insurance Crime Bureau (NICB)

This organization which happens to be a non-profit fights insurance fraud regardless of the industry. You can report them now on (800) 835-6422, or you can report online. They also provide anonymous reporting, but it is best for it not to be anonymous for some action to take place.

4. Call Your State’s Insurance Fraud Bureau

Each state has a different way of handling insurance fraud and has its government-funded fraud bureau. This is an alternative if you do not wish to reach out to the NICB. They have separate departments that handle and investigate these frauds. You can find the list of state insurance fraud bureaus here.

5. Contact Law Enforcement

Quite often, with law enforcement involved, all these bureaus and agencies start taking your case seriously. So, you might want to head down to your local law enforcement agency if it has a fraud division. In some cases, some cases may come under FBI jurisdiction, so you could contact them as well if need be.


Insurance is essential and has become a necessity in our lives as it makes it much more manageable. Insurance fraud does happen; however, it does not mean you should not opt to get an insurance plan.

The purpose of this post is to make you aware of the many vices in our society and help you become more aware of your surroundings. Let me know in the comments below something I might have missed.

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