Insurance Fraud: What You Need To Know
Insurance fraud is a serious crime and is prosecuted aggressively. Make sure you know what constitutes fraud so you don’t find yourself in severe legal trouble.
Defining Insurance Fraud
When someone deceives an insurance agency in order to receive benefits that are not their own, this is insurance fraud.
Different people can be found guilty of committing insurance fraud, including:
- The insurance company itself
Hard fraud occurs when the defendant actively planned to defraud the insurance agency. A commonly known example is someone setting their home on fire in order to collect their homeowner’s insurance money.
In hard fraud cases, the accident is intentionally caused by the person seeking the payout.
Soft fraud cases are the most common. This occurs when an individual sees an opportunity and lies about the incident's circumstances to make more money through their insurance.
An example of soft fraud would be exaggerating the severity of an accident in order to get more money for damages. The accident did occur and was not planned in advance, but the policyholder fabricated certain details to get higher compensation. Soft fraud is sometimes referred to as “opportunity fraud.”
Elements of Insurance Fraud
In order to prove that the defendant was guilty of committing insurance fraud, certain factors must be proven to be true.
- The individual knowingly made false statements with the intent to deceive the insurance agency.
- The false statement was directly regarding the incident in question.
- The lie was significant enough to impact the value of the claim.
If you have been charged with insurance fraud, you are facing a felony conviction with major consequences.
- Less than $20,000 value: third-degree felony, up to five years in prison
- Between $20,000 and $99,999: second-degree felony, up to 15 years in prison
- Over 100,000: first-degree felony, up to 30 years in prison
You may also face expensive civil fines, in addition to these criminal penalties.
Insurance fraud may not sound as serious as a violent crime like assault or armed robbery, but don’t let that fool you. If you are facing insurance fraud charges, there is a lot at stake. In some cases, fraud can become a federal offense. You will need a strong defense team to help you fight these charges. Contact Hager & Schwartz, P.A. today to get started; we go the extra mile for every case.