Insurance Fraud | Insurance Detectives

Insurance fraud has become something of a national pastime. Many policyholders think that they always pay in and never get anything back. To change this, they are sometimes willing to “help things along” and obtain compensation payments from insurers through deliberate false statements. Such insurance fraud occurs in countless areas: in traffic matters, at the workplace (for example fraudulent sick pay claims), at home, or in the form of staged burglaries. According to the German Insurance Association (GDV), insurers paid 490 million euros in 2014 alone to compensate burglary damage. It is difficult to estimate how many of these claims were genuine and how many were staged.

The insurance detectives of Kurtz Investigations Hanover are your IHK-certified specialist detectives for uncovering insurance fraud: +49 511 2028 0016.

Insurance Fraud – An Example from Everyday Life

It is always frustrating when one damages or destroys one’s own property through carelessness, as this is covered neither by household contents insurance nor by personal liability insurance. In order nevertheless to obtain compensation from an insurer, many perpetrators describe the circumstances of the damage somewhat differently.

Take, for example, the birthday celebration of the Krüger family (name changed): everyone is sitting together comfortably, chatting and – naturally – enjoying a good red wine. Mr Krüger gets up and goes down to the wine cellar to fetch more. While still in the cellar, he opens the bottle and pours the wine into a decanter so that it can breathe. He then returns to the flat with the wine. In the entrance area lies a beautiful Persian Nain carpet, which he had purchased only nine months earlier for a considerable sum. Unfortunately, even high-quality carpets have edges – always precisely where one happens to walk. The inevitable occurs: Mr Krüger trips over the edge, the decanter flies through the air in a high arc and lands on the carpet. The red wine develops a close attachment to the fine fabric and leaves a large, unsightly stain.

Fortunately, the Neighbour Has Liability Insurance

What to do? No insurer would cover this damage. But what are good friends for? Mr Bauer, as the host’s best friend, immediately agrees to settle the damage via his private liability insurance by informing the insurer that he had tripped over the carpet while holding a full glass of red wine. Factually, it is true that Mr Bauer’s insurer would have to pay if events had occurred as reported. In this case, however, a criminal offence of fraud pursuant to § 263 of the German Penal Code has been committed, involving both Mr Krüger and Mr Bauer. Fraud can be punished with up to five years’ imprisonment. That is unlikely to happen over a carpet, yet insurance fraud is not always a trivial matter. When considered in its entirety, even comparatively minor sums become significant – not necessarily in individual cases, but because insurance fraud is widespread, and small amounts accumulate into substantial losses.

Anyone who believes that insurance fraud harms “only” the insurance company is mistaken. If payout sums rise due to fraudulent claims by individuals, premiums increase for everyone. Without insurance fraud, each of us would pay lower contributions.