Who cheats more on insurance claims - policyholders or insurers?
The Coalition Against Insurance Fraud posted this video on its Web site last week from the ABC channel in Pensacola about a Florida woman who allegedly asked her insurance company for more money than she owed on a Hurricane Ivan claim.
Insurance fraud accounts for about $30 billion a year - or 10 percent - of the insurance industry's property and casualty losses, according to the Insurance Information Institute. The losses cost the rest of us more on our premiums. But policyholders aren't the only ones accused of gaming the system. Paul Berger, founder of Coral Springs-based Claim Solvers, represents policyholders in claims disputes and says insurance companies regularly low-ball claims to save money. Almost 40 percent of the complaints that Florida insurance policyholders filed this year so far are for claims handling practices, including claims delays and denials, according to the National Association of Insurance Commissioners. That begs the question: are more insurance claims underpaid or overpaid? I haven't found any data yet for home insurance claims. But Automall Network recently did a study of cars that were written off and found that by their estimates, more than half of the claims were potentially overpaid (not necessarily due to fraud but because of inaccurate damage estimates) and about 38 percent were potentially underpaid. (Insurance companies write off -- or pay policyholders for the value of a car -- when the car is stolen or damaged to the extent that replacing or fixing it exceeds what it's worth.)
