The following steps can be taken by the adjuster to protect the
insurer's interest:
- Investigation:
- Pre-contact: Analyze all the available evidence before speaking
to the home-owner. Review the claim documents, contact the
neighbours to check on visitors to the house, and obtain
eye-witness accounts. Reach out to third parties who may have
occupied the house as visitors or had business dealings with the
home owner. Check the social media activity of the home-owner or of
the visitors in the recent past, to obtain evidence about the
deliberate usage of the home for commercial purposes. Additionally,
the past records of the claimants and their close associates can be
investigated to check for any criminal antecedents or history of
fraud.
- Post-contact: Interview the home-owner to obtain more
information and record their statements on the usage of the home.
Use a line of questioning that could trap the suspects and prevent
them from back-tracking on their statements later. For example,
ascertain that the home-owner had enough access to and
understanding of the property documents to avoid a defense later
that someone else had filled in the forms on their behalf or that
they were not fully aware that their documents were false. Further,
conduct a stringent site inspection and use technology such as burn
pattern analyses and computer simulations if necessary, to prove
that the home was being used for business purposes.
- Testification: Based on the evidence gathered and past
experience, the adjuster may also serve as an expert witness in
court to testify against the claimant.
The immediate consequence of not protecting the insurer’s
interest would be the payout of a false claim and letting the
claimants get away with committing a fraud. Further, an increased
incidence of such claims affect the confidence of other customers
in the insurer and in the capability of the industry to offer them
efficient service, leading to loss of business. However, in the
longer run such false claims actually imact the customers at large,
as these lead to increased insurance costs borne by them. This is
due to pooling of risks, as the protection costs increase with
increasing incidence of frauds. A growing number of false claims
also leads to stringent controls by the insurer, such as tighter
underwriting processes, hiring of experts, investigating all claims
above a certain level and investment in technology. These further
add on to the costs and cause delays in issuing policies and
settling claims. Also, genuine claims submitted may be seen
suspiciously and analyzed closely.
In short, genuine customers and honest claimants suffer due to
the impact of false claims apart from the insurer losing
credibility.