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C39 Fraud Awareness > Chapter 9 - Automobile Claims > Flashcards

Chapter 9 - Automobile Claims Flashcards

1
Q

Define paper collision

A

When parties conspire to create the illusion of a legitimate accident using either pre-damaged vehicles or by intentionally and covertly inflicting damage on the suspect’s vehicle(s). Generally, law enforcement is not called to the scene of the accident

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2
Q

Why might leased vehicles get stolen?

A

They may be stolen and shipped overseas where they can be sold for significantly over MSRP

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3
Q

What are the terms and conditions of the VIN Verify Service that IBC provides?

A
  • There may be vehicles that have been reported as flooded that are not in the database
  • It is possible that a vehicle was incorrectly reported
  • It is possible that there are vehicles with duplicate VINs or incorrect VIN entered
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4
Q

Who are total theft claims reported to?

A

SIU & Canadian Automobile Theft Bureau

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5
Q

What information can be identified by analyzing all automobile theft claims?

A
  • New patterns usual to fraud activity
  • Fraudsters who are regulars in making claims
  • Local or international theft rings may be identified
  • Development of timely and effective strategies against fraud
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6
Q

What initiative was created to combat fraud?

A

CANATICS

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7
Q

What is CANATICS?

A

Canadian National Insurance Crime Services

  • Private sector; not for profit, inc Feb 2013
  • Industry developed solution to combat auto fraud
  • Focused on organized and premeditated fraud
  • Membership open to all insurers
  • Nine current members, reps 75% of the Ontario auto market
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8
Q

How does CANATICS help combat fraud?

A

It uses data analytics to identify suspicious claims activity and provide alerts to is member insurance companies

The individual company would decide whether or not to action the alert

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9
Q

What is the CANATICS vision?

A

To combat insurance crime for the benefit of Canadians

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10
Q

What are some examples of alerts you may get through CANATICS?

A
  • Report that details suspicious claims
  • Issued to the insurer to which the claim applies
  • Serves as a basis for investigations, not decisions
  • Privacy rules; only see info for their own policyholders
  • Policy and claim numbers of linked claims; allowing SIU to work with other SIU teams
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11
Q

What are the privacy and security functions of CANATICS?

A
  • Protection of privacy is key
  • Members will own the data that they supply
  • CANATICS is the processor of the data
  • Data is pooled and not shared
  • Members cannot access the pooled data directly
  • Access to info is strictly through controlled alerts, reports and data masking
  • Focus on minimum amount of personal data to achieve results is collected and displayed
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12
Q

What are the international partners and databases?

A

UK - The Insurance Fraud Bureau (IFB)

  • Not for profit representing 30 insurers; over 95% of the auto industry, also a pool
  • Aligned with UK government objectives

US - National Insurance Crime Bureau (NICB)

  • Clearinghouse for suspicious insurance activity
  • Constantly reviewing claims and looking for patterns of fraudulent behaviour
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13
Q

What main tool in accident reconstruction can irrefutably prove what happened?

A

The air bag module

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14
Q

What is NHTSA?

A

National Highway Traffic Safety Administration

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15
Q

What are some things loss statements may include?

A
  • Previous owners
  • Facility servicing the vehicle
  • Was it listed for sale?
  • Changes in personal life
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16
Q

Define salvor

A

One who recovers or assists in recovering damaged property, especially property damaged by fire

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17
Q

Define mareva injunction

A

A court order that freezes the assets of a defendant, in certain circumstances, pending the determination of a plaintiff’s claim. These injunctions are often used to prevent a defendant from transferring assets out of a court’s jurisdiction as soon as a claim is served, in order to frustrate enforcement of any ensuing judgment

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18
Q

What are the four types of branding?

A

Irreparable
Salvage
Rebuilt
None

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19
Q

Define stolen property

A

Property taken without permission or right, either secretly or by force

20
Q

When would a vehicle be flagged as irreparable?

A

Written off as total loss and cannot be driven, may be sold for parts or scrap

21
Q

When would a vehicle be flagged as salvage?

A

Written off as total loss. They can be repaired or used for parts or scrapped. If repaired, must pass structural test and be branded as rebuilt

22
Q

When would a vehicle be flagged as rebuilt?

A

Was previously salvage but has been repaired and deemed road-worthy

23
Q

When would a vehicle be flagged as none?

A
  • May have been branded outside Ontario
  • May have been damaged or rebuilt before program became mandatory in March 2003
  • Degree of damage did not match branding criteria
  • Vehicle has never been in a collision
  • Does not fit the other criteria
24
Q

Who must declare or remove stolen status?

A

Police

25
Q

Where does vehicle arson tend to occur?

A

Isolated locations with no witnesses

26
Q

What are the three important areas of focus once arson has been established?

A
  • Is there a financial motive for the crime?
  • Did the insured have his or her license suspended?
  • What was the condition of the vehicle prior to the fire?
27
Q

What are two common sources of evidence of opportunity in regards to automobile arson?

A

Tire tracks and foot prints

28
Q

Why is it important to establish the condition of a vehicle prior to a fire loss?

A

The condition can help determine whether or not there is reason to suspect fraud

29
Q

Define recruiter

A

One who enlists others to act as claimants in a scheme to commit fraud and to reap a monetary benefit for participating in the crime. The people recruited pay a fee to participate in the scam and in return, are offered a portion of the accident benefits

30
Q

Explain the common accident benefit scam operation

A

Seats are sold in a vehicle, as driver; passenger, etc.. accident then happens and people collect accident benefit payments

31
Q

In accident benefit scams, what information is gathered and sold to an intermediary?

A

Full name, address, date of birth and possibly drivers license number

32
Q

When are accidents typically staged?

A

At night, behind buildings or in areas w/ no witnesses

33
Q

What other criminal activities are those involved in accident benefit fraud typically also part of?

A
  • Welfare fraud
  • Workers comp fraud
  • Unemployment insurance fraud
  • Government hospital insurance fraud
  • Smuggling of illegal immigrant
  • Illegal firearms
  • Narcotics (use and sale)
  • Credit card forgery
  • Organized automobile theft
  • Home invasions
  • Money laundering
  • Organized shoplifting
  • Any opportunity for “easy money”
  • Prostitution and general criminal conduct
34
Q

What are the five main indicators of staged accidents?

A
  • Timing
  • Location
  • Vehicle
  • Passengers
  • Injury
35
Q

Explain the timing indicator

A

Was in in the evening or after midnight?
A Sunday afternoon?
Not rush hour?

36
Q

Explain the location indicator

A

Was it behind a building where the car could have been driven into a wall?
On an expressway guardrail ramp?
Places where there were no witnesses?

37
Q

Explain the vehicle indicator

A

Was it a previously damaged or salvaged vehicle?
Rental vehicle?
Someone else’s vehicle?
Targeted innocent victims vehicle?

38
Q

Explain the passengers indicator

A

Was there several passengers?
Were there no children?
Were they all of the same ethnic origin?

39
Q

Explain the injury indicator

A

Do one or more passengers have a history of accident benefit or bodily injury claims?
Is the vehicle damage minimal; yet everyone claims soft tissue injury?
Driver may not claim injury to involve own insurance?
Do they have limited Canadian ID?

40
Q

What are some service provider billing indicators?

A
  • Patterns for services outside provincial standards
  • Services never proven as provided to the claimant
  • Serviced that are billed repeatedly
  • Services billed outside normal business hours
  • Treatments that were not administered by licensed therapists
  • Therapist is no longer employed by the firm but is shown as providing services
  • Need for services is misrepresented
41
Q

What are the policy-related indicators?

A
  • Claim reported shortly after inception
  • Insured has no other business w/ company
  • Comp coverage recently added
  • Endorsement with limited depreciation is about to expire
  • Collision coverage not purchased for newer vehicle
42
Q

What are the vehicle-related indicators?

A
  • Unpopular model
  • Vehicle was stolen before or in accident
  • VIN info is inconsistent with description of vehicle
  • Vague about equipment, colour, odometer, service history
  • Insured cannot produce duplicate set of keys
  • Vehicle equipment is high value
43
Q

What are the purchase-related indicators?

A
  • Purchased from insurer, auto repair facility or salvage company
  • Was a gift w/ no records
  • Purchased shortly before theft or loss
  • Details of purchase unclear
  • Vehicle purchased considerable distance from home
  • Lienholder is a private individual or high risk service
44
Q

What are the insured-related indicators?

A
  • Other vehicles are w/ different carries
  • Works in auto related business
  • Vague or evasive about his or her business operation
  • Knowledgeable about claims procedures
  • Too expensive for lifestyle
  • PO Box as an address
  • Cannot be contacted by phone
  • Record of prior claims, thefts or never insured before
  • Payments are in arrears
  • Very aggressive or threatens to complain
45
Q

What are the theft-related indicators?

A
  • Theft not reported to police or insurer, not reported promptly
  • Police report differs from insureds report
  • Vehicle reported stolen while in custody of someone who is not a family member
  • Theft did not occur at insureds home, business or usual venues
  • Vehicle recovered in unusual circumstances
  • Police not advised of recovery
  • Expensive equipment claimed to be stolen
  • Ownership certificate appears to be a photocopy

C39 Fraud Awareness (10 decks)

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