There was the time when people used to think insurance as a luxury and accordingly they used to priortize it. But after some incidences such as: pandemics, catastrophe deaths insurance has become a necessity without a doubt. Talking about insurance and need of insurance we just cannot forego the significance of claims and settlements. According to the research there is 65% chances in almost every 3rd to 4th case that there is a likelihood of a fraud to happen. Usually there are chances of few aspects which we are going to discuss in a bit detail, so let’s roll:
As a insurance fraud investigators it is the responsibilty of an individual to check the element of antiselection. For those who doesn’t have insurance background may not be able to get it, so ‘antiselection’ is an element in which the life assured tries to unusually buy high coverage with the intention of committing fraud with the company. In layman terms antiselection is the intention of an insurance buyer to commit fraud by buying high coverage and then claim it.
Point number two which is not only important from claim investigation process but also, from underwriter’s perspective too that the beneficiary must have insurable interest in the life of the life assured. Which means that the loss of losing the life of the life assured must not be justifiable for the beneficiary, moreover, for the beneficiary life of the life assured must matter the most. This is the reason because of which insurance companies do not allow anybody to become a beneficiary unless he/she is an immediate blood relative of the life assured such as: brother, sister, son, daughter, father or mother or grand parents.
Yet another aspect to consider especially while investigating any insurance case, the client must not be overinsured. In order to make it better to understand, the client must not be given insurance coverage more than what is needed. The mantra behind this term is that the life assured must not be beneficial for the nominee when he/she is dead, life of the life assured is more important than death of the life assured.
All in all, it is important to understand that the investigation of the insurance is important, and one just cannot settle the claim then and there. Claims settlement requires complete investigation of the case and takes decision based on extracted facts and figures. Usually they find fraud in the cases where people try to cheat and steal the amount of claim by putting in wrong information. Still buying insurance is a necessity and one must buy it.