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Why savers are getting screwed

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Geithner admits USA bankrupt to US Senate

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"Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States. Default would effectively impose a significant and long-lasting tax on all Americans and all American businesses

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Real reason for electricity blackouts hitting southern US

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World economies on verge of currency revaluations to deal with debt

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"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." -- Henry Ford Basically what the world central banks are doing is increasing their money by devaluin

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Is Obama the next Mugabe of Zimbabwe?

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US raiding foreign countries with dollars, not soldiers

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allstate in bad hands

“People are anxious, their finances are in trouble and regrettably they are turning to insurance fraud as a way to shore up their financial difficulties,” said Jim Quiggle, communications director for the Washington, D.C.-based group.”

Insurance is the biggest scam going and government laws that ‘assure our security’ come second. Consumers should collectively refuse to provide the Insurance companies using the bad credit rating excuse for the right to credit records and if the companies penalize them, don’t renew. Make the insurance companies understand by hitting them where it counts; their bank accounts. Don’t let them bully you around and soon they will get the message.

Behold, the typical over-indebted American (or moreso Canadian!): “Mr. Jones” finances a home, car and lifestyle he can’t afford. He’s trying to keep up appearances by financing his growing debt via high interest credit cards. Realizing the interest is killing him, he tries to sell a vehicle but it has depreciated and is worth less than his loan (he didn’t have a down payment). Now to solve the problem he’s considering having the car “disappear” and claiming it was stolen. The same situation could happen with the house – usually a total loss fire of “mysterious origin”. In tough economic times the frequency of these claims increase. If you think this doesn’t happen, you are delusional.

Economy spurs spike in insurance fraud cases

The recent arrests of nine people in an alleged counterfeit insurance card ring is the latest wave in a rising tide of insurance fraud.

The head of the Arkansas Insurance Department’s Criminal Investigation Division blames the worst economic downturn in decades for a surge in wide-ranging cases his agency has been asked to investigate.

Nationally, officials say insurance fraud costs the average household close to $1,000 a year.

“We investigate all kinds of insurance fraud, any where from insurance agents pocketing premium money to staging car crashes to prepaid funeral home policies being pocketed,” said Greg Sink, director of the Arkansas Insurance Department’s criminal investigation division. “There are all kinds of ways to scam the system.”

In the past five years, Sink’s team of 12, including six investigators and three lawyers, has seen the number fraud cases it investigates skyrocket, from 356 cases in all of 2005 to 536 referrals during the first eight months of this year.

“It really has increased every year,” Sink said. “Yes, I would say the economy has a lot to do with the increase.”

According to the Coalition Against Insurance Fraud, the struggling national economy has caused many anxious consumers and businesses to turn to insurance fraud schemes to try and bail themselves out of financial distress.

Insurance fraud is the second most common crime in the U.S. behind burglary/theft, the coalition says.

“People are anxious, their finances are in trouble and regrettably they are turning to insurance fraud as a way to shore up their financial difficulties,” said Jim Quiggle, communications director for the Washington, D.C.-based group.

A 2009 survey by the coalition of insurance fraud bureaus across the country found that the number of cases referred and investigated rose in every category of fraud. The largest average increases were in bogus health plans, prescription fraud and fraud of insurance agents. In Arkansas, Sink said all forms of fraud are up but one that his division is seeing an increasingly high number of is counterfeit insurance cards.

The facts about insurance fraud

1. Not everyone who has a bad credit score is a bad risk, but there is a strong correlation between questionable, inflated and habitual claimants and lower credit scores. It’s called Moral Hazard and (before credit score) was harder to detect and more insidious than Physical Hazard.

2. Of “all the money” companies take in, between 70 – 110% is paid back out in claims. whats left (if any) pays market competitive wages, operational costs, and sometimes profit for shareholders.

3. Insurance companies are always called “evil” – but no one seems to think it’s wrong for a claimant to inflate their claim? this is where your money goes.

4. Shouldn’t people who have proven to be responsible with money (live within their means & pay their debts) be given a break? They allow a business to be sustainable (keep rates stable)

6. Insurance is very competitive – 200 companies in Canada (many more in the US), so collusion is impossible.

Fighting fraud and allowing a competitive private industry equals a win for consumers – those with the lowest risk factors (including credit score) deserve the lowest premium.

Related posts:

  1. Medical, Auto, Real Estate Insurance fraud rising as depression deepens“Fraud thrives in a recession, so insurers are intensifying their crackdown on insurance cheats,” said Nick Starling (1), the ABI’s director of insurance. Many consider it fraud when an insurance...
  2. Academic says underwater homeowners should throw keys at bank; arson, insurance fraud on rise as defaults increase” Go ahead. Break the chains. Stop paying on your mortgage if you owe more than the house is worth. And most important: Don’t feel guilty about it. Don’t think...
  3. Jobless rate to rise as false recovery hightens“The increase in jobs highlighted in the nation’s most recent unemployment report carried the sound of economic promise, but Obama administration officials on Sunday warned that the public shouldn’t expect...
  4. Millions Face Insurance Crisis As COBRA Ends“As part of the federal stimulus package, the nine-month subsidies made available to the unemployed starting in March have run out for those who collected them from the get-go.” While...
  5. Car insurance hike 19%; HST adds to consumer woes“Middle class families are forced to work longer and harder than ever, just to keep their heads above water.” — PC Leader Hudak Canada’s province of Ontario and British Columbia...
  6. Mortgage fraud in Canada highlights tumbling market“The Bank of Montreal has been hit by a huge mortgage fraud in Alberta that may cost it $30 million, a report said. The bank is suing hundreds of people...

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