Ch 6 Flashcards
How does theFederal Mail Fraud Statute attempt to prohibit insurance fraud?
Ain’t prohibits use of the USPS for the purpose of defrauding or obtaining money or property by means of false of fraudulent pretenses, representations, or promises.
How does RICO attempt to prohibit insurance fraud?
This law defines arson, theft from interstate shipments, mail fraud, wire fraud, bank fraud, and interstate transportation of stolen vehicles or property as racketeering activity.
How does a state reporting statute affect an adjuster’s handling of a claim?
Outlines what types of activities must reported to authorities and to whom the report must be made.
Explain how immunity statutes can differ from one state to another.
Some states grant immunity only if a public authority initiated the request for information. Other states grant immunity to those who cooperate with authorities and those who initiate contact with authorities. Some states grant immunity only from civil suits. Others for both civil and criminal.
Three common fraudulent schemes.
Deliberately causing, claiming a loss that has not occurred, exaggerating the amount of loss.
Why should SIU be involved as early as possible?
Preserves the integrity of the investigation and facilitates the investigation. Allows the adjuster to continue working on the loss whole a parallel SIU investigation is conducted.
Leading cause of arson?
Vandalism
Why do insurers pay arson losses?
Insured either did not commit or proving involvement is often not possible.
What must an insurer prove to successfully assert an arson defense against an insurer’s claim?
That it was deliberately set and it was set by, or at the direction of, the insured
Four areas of proof needed in an arson investigation.
Incendiary fire
Opportunity
Notice
Other miscellaneous evidence
When does fire spread horizontally?
If trapped from moving upward
If a great deal of crowded combustibles
If there is an accelerant
What financial circumstances might suggest to an adjuster that the insured had a motive for arson?
Financial motive is present when an asset is losing value, cannot be sold, or is overinsured.
What circumstances at the fire scene tend to show involvement by the insured?
Premises unlocked and alarms disabled. Any evidence that the insured knew the fire was about to occur tends to show involvement. Lack of normal personal property.
What specific role does an adjusted play in an arson investigation?
Coordinates the efforts of all persons involved in the arson investigation,gives clear instructions on the scope of assignments, responds promptly to inquiries, makes the ultimate decision on the claim.
Distinguish the tiles of an origin and cause expert and a forensic chemist in an arson investigation.
Origin and cause: determines how and where fire began.
Forensic chemist: identify chemical residue.
What specific information can adjusters obtain from firefighters ?
Where fire started
If premises were locked
Unusual odor
Behavior of owner
What information can an accountant provide to an arson investigation?
Can provide into relevant to whether the insured had a motive to commit arson.
How do adjuster’s evaluate the plausibility of alleged burglaries to residences?
Were items typical of the homeowner’s lifestyle and income?
How do adjuster’s evaluate the plausibility of alleged burglaries to commercial properties?
Investigate employees and neighbors. Was any property moved?
What steps can adjuster’s take to control “padded” claims?
Require sworn proof of loss and supporting documentation.
Why do SIUs exist?
Prove that a claim is legitimate and should be paid, determine the facts of suspicious claims, prove fraud, avoid improper and unfounded accusations that can cause bad-faith problems, to pay claims that are supported by evidence.
What are the typical requirements of state-mandated anti-fraud plans?
Require specific procedures to detect internal fraud, to identify claims fraud, to report suspected claims fraud to state authorities and to index bureaus, and to initiate civil action against fraud perpetrators.
What backgrounds and additional training do SOU personnel typically have?
Claims and law enforcement.
How does violent crime control and law enforcement act of 1994 attempt to prohibit insurance fraud?
Makes insurance fraud a federal crime when it affects interstate commerce.
What does the arson defense require proof of?
That the insured deliberately caused the fire.
What should the fundamental issue faced by an insurance adjuster in any arson investigation be?
Whether to pay or resist the claim.
What are the two keys to fighting any type of fraud?
Detection and investigation.
An intentionally set fire is also know as?
An incendiary fire.
Some states grant immunity from ______ suits only.
Civil
