EPIS in Los Angeles Metro: Unveiling Insurance Fraud | A Comprehensive Introduction

The dictionary defines fraud as the intentional perversion of truth to induce another to part with something of value or to surrender a legal right. Insurance fraud can be “hard” or “soft.” Hard fraud occurs when someone deliberately fabricates claims or fakes an accident. Criminals are using increasingly sophisticated electronic schemes to defraud insurance companies.

Types of Insurance Fraud

Soft insurance fraud, also known as opportunistic fraud, occurs when normally honest people pad legitimate claims or intentionally understate the number of miles they drive each year or, in the case of business owners, list fewer employees or misrepresent the work they do to get a lower premium.

Perpetrators of Insurance Fraud

Those who commit insurance fraud range from organized criminals who steal large sums through fraudulent business activities and insurance claim mills to professionals and technicians who inflate the cost of services or charge for services not rendered, to ordinary people who want to cover their deductible or view filing a claim as an opportunity to make a little money.

Vulnerability of Insurance Sectors

Some lines of insurance are more vulnerable to fraud than others. Health care, workers compensation, and auto insurance are believed to be the sectors most affected.

Insurance Fraud as a Felony

Insurance Fraud classifies as a Felony: Insurance fraud is specifically declared unlawful in the state’s penal code. A fraudulent act is committed if information in insurance applications is falsified in an attempt to obtain lower premium rates, or to inflate the amount of loss in a claim. Raising the level of the crime from a misdemeanor to a felony not only increases the penalties but also acts as a deterrent to future crimes.

Effective Investigative Techniques

Investigators have used pretexts to obtain information for quite some time. When used correctly, it is an effective investigative technique for gathering difficult information, which might otherwise be unattainable. Before utilizing pretext, EPIS investigators conducting insurance investigations be consider pursuing available public records and conducting Internet and database searches, as they may produce useful information about a claimant’s daily activities, business or self-employment activities, published financial information, education, hobbies and any limitation and restrictions relative to lifestyle.

Pretexting in Insurance Investigations

Our Los Angeles investigator’s performing work for insurance companies potentially expose themselves and their clients to financial liability when utilizing pretext techniques. EPIS will always check with the carrier or the insurance clients prior to utilizing pretext in an investigation to ascertain whether they have a pretext policy and to obtain their permission.

Risk Mitigation and Permissions

Not all pretexts are the same. Consider the difference between first party and third party pretexts. In a first party pretext our Los Angeles investigator attempts to obtain information directly from the subject. In this type of pretext the risk is considerably low because there is no third party involved. In the third party pretext, the Los Angeles investigator calls someone familiar with the subject and attempts to obtain information about the subject.

Frequently Asked Questions (FAQ) About Insurance Fraud Investigations

What is insurance fraud?
Insurance fraud involves intentionally deceiving an insurance company for financial gain. It can be categorized as “hard” fraud, where accidents or claims are fabricated, or “soft” fraud, where individuals manipulate legitimate claims.

Who commits insurance fraud?
Perpetrators of insurance fraud vary, ranging from organized criminals engaged in fraudulent business activities to professionals inflating service costs. Even ordinary individuals may commit fraud to cover deductibles or seek financial opportunities.

Which insurance sectors are more vulnerable to fraud?
Health care, workers compensation, and auto insurance are believed to be more vulnerable to fraud compared to other sectors.

Is insurance fraud a felony?
Yes, insurance fraud is classified as a felony. Falsifying information in insurance applications to obtain lower premiums or inflating claim amounts is explicitly unlawful.

What are effective investigative techniques for insurance fraud?
Investigators often use pretexts, a technique involving obtaining information through legal and ethical means. This includes accessing public records, conducting internet searches, and obtaining information from available sources.

What is pretexting in insurance investigations?
Pretexting involves using a false identity or scenario to obtain information. In insurance investigations, it’s crucial to check with carriers or clients for permission before utilizing pretext techniques.

Are all pretexts the same?
No, there are differences between first-party and third-party pretexts. In a first-party pretext, investigators attempt to obtain information directly from the subject, posing lower risks. In a third-party pretext, investigators contact someone familiar with the subject to gather information.

How can investigators mitigate risks and obtain permissions?
EPIS investigators ensure compliance with carrier policies and obtain permission before using pretext techniques. This helps mitigate risks and ensures ethical investigative practices.

Next Steps | Secure Your Investigations with EPIS

When it comes to insurance fraud investigations, trust Empire Pacific Investigative Services (EPIS) to deliver reliable and ethical services. Our experienced team employs effective techniques, including legal pretexts, to uncover the truth. Ensure the security of your investigations by partnering with EPIS.