The most common types of insurance fraud to watch out for

The insurance industry and its more than 7,000 companies collect roughly $1 trillion in premiums annually, according to the latest FBI data from 2019. With that much business, there is sure to be a sizeable amount of fraud. The FBI asserts the total cost of insurance fraud in the U.S. (excluding health insurance) is estimated to be more than $40 billion per year, costing the average U.S. family between $400 and $700 annually in the form of increased premiums. Across all lines of insurance, the Insurance Information Institute (I.I.I.) estimates that insurance fraud losses total a minimum of $80 million annually. In the P&C space, studies conducted by I.I.I. found that insurance fraud comprises about 10% of losses and loss adjustment expenses annually, equating to about $34 billion each year. Workers' compensation insurance fraud alone is estimated to cost insurers and employers $6 billion per year, according to the Coalition Against Insurance Fraud (CAIF). Due to the sheer size of the insurance industry and the volume of claims, preventing losses from fraud entirely is impossible, so it's important that adjusters and agents know what signs to look for to detect fraud. In the slideshow above, discover 6 of the most common types of insurance fraud to look out for. See also:

• Coronavirus fraud: A guide to potential schemes

• 10 things you should know about how AI fights insurance fraud