Insurance Fraud Doesn’t Pay
Do you remember the Dick Tracy slogan?
It was Crime Doesn’t Pay!
You know that the long arm of the law will catch the bad guys.
Okay…it was just a comic strip.
But you know what it meant.
Criminals should not reap the rewards of their crimes.
That includes all crimes – including those involving life insurance.
Faking death to file a claim
You may have caught wind of this news story about attempted insurance fraud. Here is a capsule:
A Florida businessman who authorities say faked his own death to dodge debts while reaping millions in life insurance benefits is sitting in a North Carolina jail after applying for a passport under another man’s name.
It is an all-too familiar formula for life insurance fraud:
- Get into debt
- Get desperate
- Buy insurance
- Fake your death
- Live happily ever after (you hope)
- But then get caught
Good thing he did not go about it smartly.
You and I might have suffered otherwise.
Because when people commit insurance fraud, all other policyholders suffer.
Illegitimate claims drive up the cost of products needlessly. Ask any actuary.
No worries, though. The bad guys get caught often enough.
We can rest secure.
Don’t commit insurance fraud!
Of course, you and I would never even consider such a scheme to get rich quick. Nonetheless, temptation is always there to cut corners. Have you ever heard someone say, “What the insurance company doesn’t know won’t hurt me?”
Not good advice. Remember:
- “Big Brother” is watching. Government databases, corporate files, and the internet can all be combed to find out about you. When you apply for coverage, your record of prior applications, of prescriptions, and of motor vehicle violations are all pulled.
- Life insurance fraud poses a big temptation. Big benefits can be purchased for pennies on the dollar. The possibility of getting big money for cheap can be very attractive – too attractive, if you don’t keep your head on straight.
- To commit fraud means having to live a phony life. Consider our friend in the new story:
Once in custody, the former dead man is reported to have signed a form waiving his Miranda Rights using his real signature. “It’s been a long time since I signed my true name,” he told the agents, according to court filings.
Life insurance fraud is a real problem.
Companies can and will go to great lengths to uncover it.
That is why full disclosure is absolutely necessary when you apply.
Everybody involved should be able to sleep at night knowing that the benefit could and should be paid when the time comes.
What about you? Did you find it hard to go through full disclosure on your own life insurance application?