Home » What Is Insurance Fraud?

Insurance fraud is a crime that occurs when someone tries to make money from insurance transactions through deception. Here are some examples of insurance fraud:

Property Fraud – occurs when someone exaggerates the amount of damage incurred to their home, vehicle or other possession; deliberately damages their possessions for reimbursement by the insurance company; or seeks reimbursement for a lost or stolen item that was neither lost nor stolen. 

Casualty Fraud – occurs when someone fakes or exaggerates an accident or injury to receive money from an insurance company. “Slip-and-fall” cases are an example of this.

Worker’s Compensation Fraud – occurs when an employee claims to have suffered an injury while on the job and either didn’t suffer an injury at all, or received the injury while doing something non-work-related. Employers can also commit worker’s compensation fraud by understating the number of employees or the type of work they do.

  • Insurance fraud is the second most costly white-collar crime in the U.S., behind tax evasion. (1)
  • Insurance fraud costs the average Virginia household $1,000 a year. (2)
  • Nationwide, insurance fraud robs us of nearly $80 billion a year. (3)
  • 1 out of 6 Virginians claim they know someone who has received workers’ compensation for an injury that did not occur on the job. (4)
  • More than 1 of every 3 bodily-injury claims from car crashes involve fraud. (5)
  • Arson and suspected arson account for nearly 500,000 fires a year, or 1 of every 4 fires in the U.S. (6)

For more information, read the Insurance Fraud Brochure, the Vehicle Insurance Fraud Brochure or the Homeowner's Insurance Fraud Brochure.

1, 2, 3 - Coalition Against Insurance Fraud, 2001; 4 - IFD Statewide Survey on Insurance Fraud by SIR, 2000; 5 - Insurance Research Council – 1996; 6 - National Fire Protection Association, 1998


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