Insurance fraud has been an issue since the inception of insurance policies in the 18th century. It involves any act committed with the intent to obtain a fraudulent outcome from an insurance process.

Fraud can occur when a claimant tries to gain a benefit to which they are not entitled, or when an insurer knowingly denies a benefit that is due. Fraud by insurers and insureds is actionable in court. According to the Coalition Against Insurance Fraud, up to $96 billion is stolen each year through insurance fraud schemes, a number which could be much higher since no one knows how many fraud schemes are successfully executed without raising suspicion.

New ways to cheat

As fraudsters develop new creative ways to cheat insurers out of claims payouts, insurers have to re-evaluate their detection methods to decrease the payouts for false claims. Countless fraud attempts have been foiled by technology through security camera footage, personal social media sites, location applications, posted pictures, and YouTube videos. Since most adults use social media today, they often leave a trail of public information including what they think and say, what they have done, and who they are associating with, which allows insurance companies to uncover discrepancies between the public story and the one told when a claim was filed.