Jump to content
SASS Wire Forum

Insurance Fraud Discussion


Recommended Posts

In a Post I started yesterday, the topic of Insurance Fraud came up.

The point being raised was whether damage to a vehicle's rear fender from a previous accident, and not repaired, be reported to the Insurance Company if further damage had occurred to the same area. If not reported, would that be considered Insurance Fraud.

In the scenario I wrote, I would not consider it as being Insurance Fraud.

A basic definition of Insurance Fraud is the wrongful deception of an insurance company for the purpose of wrongfully receiving compensation or benefits.

If your claim is merely for the damages that were legitimately incurred, you are entitled to receive said compensation.

Here are a few additional scenarios being presented for relevance:

 

1. Your 1,300 square foot house, built in 1994 needs a new roof, as it has started to lose shingles, and some water damage is being spotted on the inside.

     Before you can have it repaired, which is not covered by your insurance policy, a Category 5 Hurricane comes through your county and rips the roof off of your house.

     Do you:

A. Count your loss and move to another city and buy another house;

B. File a claim with your Insurance Carrier to have your roof replaced, not telling them about the need to have the tiles replaced based on age;

C. File a claim with your Insurance Carrier, making sure to point out that it needed to be re-roofed, provide them with the estimate you received, so that they can deduct said amount from the total of the claim;

D. Hire an attorney to handle your claim and let him decide if he wants to tell them about the re-roofing issue.

 

2. You've been driving your new 2018 Mercedes Benz C-Class; however, it has gotten dinged by grocery carts, door panels scratched from parking too close to the next vehicle in the parking lot, had the back bumper dented from backing into a telephone pole, and a broken tail light from your son hitting it with a fly ball.

      Then one day you are t-boned in an intersection while you had the green light and the Mercedes flipped twice and was totaled. You were not seriously injured. The Police report vindicates you and puts the blame fully on the vehicle running the red light.

     Do you:

A. Take the cash settlement and buy another vehicle;

B. File a claim with your Insurance Carrier to have your vehicle replaced, not telling them about all the prior damage that was never fixed;

C. File a claim with your Insurance Carrier, making sure to point out that it had all these prior issues with it, and ask that they take them into account when processing your claim amount;

D. Hire an attorney to handle your claim and let him decide if he wants to tell them about the prior damage.

 

Are your responses different in those two scenarios.

What would the average, law abiding citizen do in those cases.

Would answer B in either case truly be considered Insurance Fraud?

Your opinions are welcome.

 

 

Link to comment
Share on other sites

I would figure that shopping cart dings are normal wear and tear and not worth mentioning.  As for the roof, my guess is that the ins company would depreciate the roof by 25 years before paying for it. Depreciation takes into account any minor damage it had, so that’s not a problem either.  I could be wrong. In the event of fire, you just get a new roof, no problem.

Link to comment
Share on other sites

Depends on the policy.  A standard auto or property policy will apply depreciation depending upon the age and condition of the insured property, reducing the recovery.  There are, however, policies available for so-called "replacement cost" or "agreed value" coverage, which in many cases will pay the full replacement cost without depreciation.  The premium is usually higher, but it eliminates all the haggling with the insurer over depreciation.  Many insurers, however, will hold back some percentage of the replacement cost until you prove that you actually replaced the property.

 

Failing to reveal pre-existing damage IS insurance fraud.  You are misrepresenting the condition and value of the insured property if you do not reveal that damage during the processing of the claim.  You are, in essence, claiming a higher value than you are entitled to recover (unless you have a policy that does not apply depreciation).  You have an affirmative obligation to reveal that damage; an insurance claim is not a game of hide and seek.

 

LL

 

PS:  In most claims, before you are issued a check, the insurer will want you to sign a sworn statement, verifying your ownership of the insured property and your representation of its pre-loss value.  Don't fib.

 

LL

Link to comment
Share on other sites

My feeling is if a new dent damages the fender much more severely than the original foot dent as in the giant tire hitting it. What difference does it make? They can't fix the fender back to when it only had a small dent!  They don't deduct on repairs in a crash if the car had rot on the fender, the fender still needs to be replaced. The cost of the new repair is the same either way if the damage is in the exact same spot. JMHO

Link to comment
Share on other sites

When Category 5 Michael came visiting last October, he left me needing a new roof.

 

FEMA allowed me three thousand dollars. I suspect that piddling amount is because I told them the roof was thirty years old. I further suspect that if I'd told them I'd put a new roof on it last year, they would have paid me for a new roof.

 

But I didn't tell them that. Didn't even consider (until I saw that miserly amount, and thought, "Hmm. If I'da said...") telling them that. Not because misleading them that way would have been illegal.

 

Simply because I don't do stuff like that. As I've told people before, I'm honest. Quite possibly too honest, for this day and age.

Link to comment
Share on other sites

8 minutes ago, Alpo said:

Quite possibly too honest, for this day and age.

 

My friend, there is no such thing.

 

There is honest, and then there is not honest.  

 

Some things are black and white.

 

Glad to hear that you choose honesty.  Too many choose the other.

 

LL

Link to comment
Share on other sites

About 10 years ago we had a huge thunderstorm with high winds. Many roofs were damaged.  A friend of a friend had a guy in the insurance business. He was going around assessing roof damage. He told me I could get a new roof. I had it inspected by the city inspector, who I know, he said my roof was fine. I turned down the new roof offer because I thought it was a scam. I too feel I’m a little too honest for my own good. BTW I replaced my roof last year! :o

Link to comment
Share on other sites

In todays legal climate, you could find the culprit that kicked in your fender, find out the

manufacturer of his shoes.....and sue the boot company.    

 

..........Widder

 

Link to comment
Share on other sites

11 hours ago, Widder, SASS #59054 said:

In todays legal climate, you could find the culprit that kicked in your fender, find out the

manufacturer of his shoes.....and sue the boot company.    

 

..........Widder

 

Hell, you could sue the sock company.

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.