Essays on Car Insurance Fraud Case Study

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The paper 'Car Insurance Fraud' is a great example of a Business Case Study. Insurance fraud has remained a serious and costly problem to not only the insurance companies but also the policyholders across all the insurance industry sectors. This paper gives a special focus on car insurance fraud. This type of fraud occurs in Auto Physical Damage, APD which entails comprehensive and collision and claims associated with injuries under the Personal Injury Protection, PIP. This paper explores several situations that are prevalent within PIP and APD claims and the tactics employed by the insured people to execute fraudulent claims against the insurance companies.

To identify these fraudulent activities and claims, the logistical regression as well as the statistical tool used. Many insurance companies opt for the units dealing with claim investigation to carry out an investigation on fraudulent claims. This unit collects sufficient information and evidence to either reject claims deemed to be fraudulent or give an authorization of payment in cases that lacks adequate grounds to draw fraud intentions. Research also shows that the industrial estimates of 10-15% of the premium cost are used in backing fraudulent related claims.

The profitability of a corporation may be increased through appropriate identification and denial of claims of fraud. By so doing, the level of premiums can be managed at a lower level than they would have otherwise been. Keywords: Fraud, Insurance, Regression Logistic Introduction Basically, car insurance fraud can be defined as any form of trickery committed or executed against an auto insurance company with the motive of getting monetary gain. It can range from presented piled- ups to fibs regarding any form of damage that may occur after an accident which may be or not somewhat minor.

The commitment of car insurance varies from slight exaggerations and omissions to deceptions that are quite obvious. The role of auto insurance is to ensure that any insured who encountered a loss is indemnified or reinstated to his or her previous financial position before the loss. Those who get involved in car insurance fraud try to obtain undue benefits through an insurance policy that will see them over indemnified. Automobile insurance fraud is notable for becoming a global problem and not in the U. S.

only. While this paper gives a specific emphasis on car insurance, it important to note that fraud exists as well in other insurance. Auto Physical Damage (APD) Fraud Car insurance fraud can occur in several ways. These forms of car fraud areas discussed as follows: Owner give-up/ vehicle dumping This is the kind of car insurance fr45aud which occur when the car owner leaves his or her vehicle or disposes of it, leave it in place, burn, sell or even dump it and goes ahead to claim that it was stolen.

Under cases where a car is sold before it gets reported as stolen, the fraud can be paid in two ways. First, it is intended to be paid through the normal insurance payment to replace the stolen cars. The other way is by selling the original car (Dionne & Laberge, 1999).

References

Dionne, G., & Laberge-Nadeau, C., (1999). Automobile Insurance: Road Safety, New Drivers, Risks, Insurance Fraud and Regulation. Boston [u.a.: Kluwer Acad Publ.

Hymes, L., Wells, T., & Association of Certified Fraud Examiners. (2013). Insurance Fraud Casebook: Paying a Premium for Crime.

Lundy, W., & American Educational Institute. (2001). Auto Insurance Fraud. Basking Ridge, N.J.: American Educational Institute.

McMillan, J., (2006). Policies and Procedures to Prevent Fraud and Embezzlement: A Guide for Small and Mid-sized Businesses. Hoboken, N.J: Wiley.

Rezaee, Z., Baker & Taylor, Inc. (2002). Financial Statement Fraud: Prevention and Detection. New York: Wiley.

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