IBC: Spot these five common insurance fraud scams

At the kick-off to Fraud Prevention Month, Insurance Bureau of Canada (IBC) advised the public to watch out for insurance fraud scams. This type of crime cost Canadians well over $1 billion a year in added insurance premiums, and strains our already burdened health care, emergency services and court systems.

"When someone makes a false or exaggerated claim, it's the honest policyholders that pay for it," said Bryan Gast, National Director, Investigative Services, IBC. "IBC wants to help consumers avoid falling victim to insurance fraud," said Gast. "The more people report fraud, the more fraudsters we can bring to justice."

Here are five common ways criminals manipulate Canadians and the insurance system:

Five common types of insurance fraud

1. Inflated Tow, Store & Dent
   Dishonest towing companies and auto repair shops intentionally overbill insurers, driving up insurance premium costs.

2. The Blank Form
   Disreputable medical clinic staff ask claimants to sign blank accident benefit forms and then bill insurers for services that were not provided. Or, the clinics might forge the signatures of medical practitioners on forms to bill insurers for services never rendered.

3. Staged Collision
   In a staged collision, a driver intentionally causes an accident with an unsuspecting driver and makes it look as if the innocent driver is at fault.

4. Fake News
   With policy misrepresentation, an individual misleads an auto insurance company by providing misinformation, such as a false address, or make or model of his or her vehicle. The individual carefully chooses this false information because of its reduced risk profile, which reduces the amount he or she should pay for auto insurance.

5. Hot Cars
   Stolen, unrepairable and often dangerous vehicles are given a false vehicle identification number and then sold to unsuspecting consumers.

Gast's national investigative team partners with law enforcement, government agencies and insurance companies across the country to identify insurance crime, investigate fraudsters and scam artists, and bring criminals to justice. The IBC team focuses on all aspects of insurance fraud, including organized crime rings involved in auto theft and fraudulent injury and accident benefit claims.

Five tips for avoiding fraud after a collision

1. Contact your insurance company if a stranger tries to steer you to an unknown body shop, doctor, chiropractor or legal representative.

2. See only medical and legal professionals you know and trust, or who are recommended by people you trust.

   a. Contact medical and legal licensing regulators in your province to ensure that your service providers are licensed and that no complaints have been lodged against them.

   b. Know what your medical benefits are; for example, what is and isn't covered.

   c. Keep detailed records of your medical appointments, including the dates, locations, names of practitioners, diagnoses and services. As well, record the medicine, supplies and/or equipment that were prescribed.

3. Be involved in your claim. Compare your records against the statements you receive from your insurance company to make sure the bills are accurate and don't include goods or services you didn't receive.

4. Never sign a blank insurance claim form.

5. Know what your full and final settlement includes.

It's easy to report a suspected exaggerated claim, staged auto collision or other insurance crime. Call IBC's anonymous, toll-free TIPS Line at 1-877-IBC-TIPS (422-8477) or submit a tip online at ibc.ca.