4 Wacky Examples Why Insurance Fraud Isn’t Worth the Risk
The large death benefits of life insurance policies are sometimes so alluring that a scammer devises an illegal scheme so wacky, it might actually pay off.
With an average face value of $163,000, according to Statista, the allure of insurance fraud is understandable from the mindset of a down-and-out crook. And because a life insurance policy can cost as little as three bucks a month, certain unscrupulous individuals (or groups) might be inclined to conduct a little insurance fraud.
The temptation of an unearned payoff sometimes leads to some odd and zany cases of insurance fraud — that often result in embarrassing situations at best, and jail at worst.
What is Insurance Fraud?
Though there are many different ways to conduct insurance fraud, they all involve one common denominator: deceit.
Insurance fraud can be something as simple as getting into a car crash and lying about how much damage was done in hopes of getting a higher payout. Or it can involve faking your own death to collect on your life insurance while you’re, you know…entirely not dead.
Insurance fraud is estimated to cost over 100 billion dollars per year. According to the FBI, non-health insurance-related insurance fraud costs the average family $400 to $700 per year in increased insurance premiums.
Committing insurance fraud can lead to prosecution, jail time, and monetary penalties. You might also be unable to purchase life insurance again or be stuck paying higher premiums than you would otherwise.
Wacky Life Insurance Scams
Despite the industry’s best efforts, some ne’er-do-wells continue to think of loopholes and underhanded methods to commit life insurance fraud. Their plots, schemes, and scams are sometimes just zany enough to work, if only until they’re revealed.