Did you recently suffer an insured loss but were forced to jump through hoops by your insurance company just to prove it? Or are you dealing with someone who’s falsely claiming against you and your policy?
Disputing a false insurance claim that was thrust upon you can feel like navigating an infuriating maze of cold shoulders and heavy sighs. You’ve now suddenly assumed the role of an amateur detective.
It’s a race against time since, with every minute you spend gathering stacks of documents, photographs of the incident, and witnesses that can substantiate your injuries or damage. Embarking on the challenging journey of disputing a false insurance claim is not for the faint of heart either, but having expert professionals by your side can be your greatest ally.
In this article, we’ll provide you with practical tips, necessary knowledge and expert insights that can empower you to efficiently challenge the system – and win.
Recognizing and Understanding False Insurance Claims
Insurance fraud is a consistent threat that insurance companies and policyholders need to be wary of, as it consists of intentionally providing false material information for the purpose of obtaining insurance benefits.
The Coalition Against Insurance Fraud said that fraud costs businesses and consumers $308.6 billion a year. Additionally, the Federal Bureau of Investigation (FBI) estimates fraud costs the average family between $400 and $700 a year in premiums.
However, if you have a perfectly valid claim and your insurer unreasonably denies it, it defeats the purpose of entering into an insurance contract. It’s disconcerting to grapple with the thought that you’ve diligently paid all those premiums without enjoying the promised security.
Likewise, you must also know how to protect yourself from dubious claims against your policy. Here are some practical tips on how to properly protect your insured interests:
Disputing A False Insurance Claim
1. Know Your Policy Inside Out
When faced with a loss, find the nearest available copy of your insurance policy and thoroughly review it. If you’re physically able, you should thoroughly review the terms, conditions, and coverage specifics. Otherwise, you can entrust the task to a partner or a relative to go over it for you.
If you know your policy inside and out, nobody can use it against you. However, it is best advised that you consult with your lawyer so they can clarify any confusion that you might have about the provisions.
2. Document Everything About The Incident
Meticulous documentation is key in the dispute process, especially if someone filed a false insurance claim against you. If you’re involved in an accident, take photos, record videos, and gather witness statements. You should create an airtight case to challenge any inaccuracies or inconsistencies with solid evidence.
3. Keep Calm and Communicate Respectfully
When disputing a claim, maintaining a calm and collected demeanor is crucial – now is not the time to lose your cool. You must approach your insurance company or the other party with clear and concise communication. You should also be ready to articulate your points effectively. When words fail, let your attorney speak on your behalf.
4. Hire A Seasoned and Compassionate Legal Team
In a matter like this, don’t hesitate to seek professional help when necessary. Consulting with an attorney specializing in insurance disputes can provide valuable insights and guidance.
Filing a legal claim without the assistance of a lawyer is possible for anyone, but it’s essential to understand that there are various factors to consider and actions to take in order to ensure the success of your claim.
The court is unable to provide you with legal advice, and the insurance company or the other party typically has a team of lawyers who are actively working against you. At Desai Law, we help our clients take action against insurance fraud.
5. Investigate If There Is Insurance Fraud
False insurance claims often signal an attempt at insurance fraud, which is considered a felony under U.S. law. It’s imperative to assess whether the false claim was a deliberate act or an inadvertent mistake.
Should the claimant be found intentionally deceiving the insurance company, they could be implicated in a serious offense. Moreover, according to the National Association of Insurance Commissioners (NAIC), there are two categories of fraud: hard fraud and soft fraud.
“Hard fraud” occurs when a policyholder deliberately destroys property with the intent of collecting on the insurance policy. Meanwhile, “soft fraud,” which is more common, occurs when a policyholder exaggerates an otherwise legitimate claim or intentionally omits or lies about information on an application to obtain a lower premium. Soft fraud is often considered a crime of opportunity.
You should be vigilant in determining which type you’ve encountered and make sure to swiftly report it to the authorities and your insurance company.
6. Take Time To Understand State Laws
You must familiarize yourself with your state’s specific laws regarding insurance claims and disputes. Knowing your rights as a policyholder will give you a solid foundation for disputes.
For example, West Virginia enacted the Insurance Fraud Protection Act (IFPA). Among other things, its aim is to prevent the overvaluation of land, property, or securities and to avoid embezzlement of money, funds or premiums.
It also prevents deceptions concerning the financial condition or solvency of businesses and generally eliminates fraud committed by people who work in the insurance industry.
7. Utilize Consumer Protection Resources
There are federal and state laws that protect consumers from false or deceptive practices by people or businesses selling insurance coverage.
This includes anything from false claims about a policy’s features or coverage to schemes to collect premiums from consumers with no intention of paying claims. It’s important to also be proactive about knowing your rights as a policyholder, so it’s best to get in touch with resource groups to learn more.
8. Create a Paper Trail
It’s important that you document every interaction with your insurance company and the other party who filed an insurance claim against you. Keep a record of emails, letters, text messages and phone calls.
A detailed paper trail can serve as evidence of your efforts to resolve the issue and address the matter in good faith, which may be valuable if legal action becomes necessary.
9. Inform Your Insurer Right Away
Another important act for you to do as a diligent policyholder is to inform your insurer right away that someone is falsely claiming against your policy.
The last thing that insurance companies want is an unnecessary payout, and they’re incredibly masterful at spotting a fraudulent claim right away. However, before they can help you avoid it, you must notify them as soon as possible.
According to the FBI, some companies have systems in place for reporting fraud. If the company doesn’t have a reporting system or fraud hotline, call or write the company headquarters.
If you encounter a car crash, for example, give your insurance company all available records and pieces of evidence that you have. Of course, the assistance of a lawyer would be best so you know which ones are necessary for your case.
10. Educate Others
Lastly, don’t forget to share your experience with others, especially if they face similar challenges. You can do this by engaging in local community groups, online forums, or any other public avenue where you can spread awareness and information.
Aside from collecting valuable insights, you might be able to connect with legal networks that can help you navigate this ordeal with ease. Remember, you’re not alone in this, and collective knowledge is a powerful tool.
Legal Options for False Insurance Claims
Report Your Complaint To Regulatory Authorities
Notifying your insurance company is one thing, but filing a complaint with regulatory authorities would also expedite the resolution of your situation.
You can check to see if your state sponsors a fraud bureau that investigates insurance fraud since most states do. The FBI advised that you may even be eligible for a reward if you report a scam. You must directly report insurance fraud to your local FBI office.
Additionally, you can report your predicament to the National Insurance Crime Bureau (NICB), a non-profit organization that partners with insurance companies and law enforcement to help identify, detect, and prosecute insurance criminals.
Moreover, you can also file with the Coalition Against Insurance Fraud (CAIF), a national alliance of consumer groups, public interest organizations, government agencies, and insurers dedicated to preventing insurance fraud.
Finally, the National Association of Insurance Commissioners (NAIC) can further assist state insurance regulators in serving the public interest and achieving regulatory goals.
Seek Legal Counsel To Deal With A False Insurance Claim
While all the above-stated authorities would be incredibly helpful as you deal with a false insurance claim, the best option is to enlist the services of an experienced lawyer.
Your legal counsel is your strategic partner, and their expertise can ensure you navigate the complexities of insurance law with precision. With their help, you can avoid pitfalls that could compromise your case.
A lawyer is also invaluable when your insurance company decides not to support your defense against a false claim. This can happen due to delayed claim notification or a lack of valid coverage during the incident.
Your attorney can step in to facilitate the recovery of damages resulting from the false insurance claim and initiate an appeal against the insurance company’s decision to withhold its support.
Sue The False Insurance Claimant For Damages
After deciding on a lawyer, you can discuss the possibility of filing a personal injury lawsuit against the claimant, seeking punitive damages.
Punitive damages serve as a means to penalize the other party for malicious, fraudulent, or oppressive conduct, which can include a false insurance claim. You can get compensated for the stress, anxiety, and inconvenience that they have caused you.
Hire Desai Law Now
No one wants to pay for undue expenses nor be held liable without fault. Having a seasoned and compassionate lawyer by your side not only safeguards your interests but also bolsters your chances to effectively dispute a false insurance claim.
At Desai Law, we are fierce advocates of those who fall prey to fraudulent practices. We are passionate about defending people who have been wronged or taken advantage of – all it takes is a quick consultation for you to know that we can fight by your side.
We’re eager to help you overcome this challenge. Call (304) 974-1974 now.