One In Three Say Inflating Claims Is Okay

By Michael Ha

NU Online News Service, July 25, 3:08 p.m.EDT?Many Americans view exaggerating insurance claims tomake up for a deductible or premiums paid as a victimless crime,according to a survey.

The latest research by Insurance Research Council, part of theAmerican Institute for CPCU and the Insurance Institute of America,found that 33 percent of respondents agreed with the statement thatit is "all right" to exaggerate insurance claims to make up for adeductible. And 22 percent of those surveyed agreed with thestatement that it is acceptable to boost the claims amount to makeup for premiums paid when no claims were made.

The survey results were based on two separate studies from lastyear: The first study, conducted last October, consisted oftelephone interviews with 1,008 adult respondents in the UnitedStates. The second study, held in June 2002, consisted of in-personinterviews with 1,995 respondents.

"I think there is still a perception out there that once youhave a claim, people are going to take advantage of it," saidElizabeth Sprinkel, senior vice president at Malvern, Pa.-basedInsurance Research Council.

"A lot of people still think a few dollars here and a fewdollars there wouldn't be that big of a deal, but the problem is,that's where the money is. When lots of people pad their claims,all that adds up to big money," Ms. Sprinkel told NationalUnderwriter.

Ms. Sprinkel also offered a reminder that, according to NationalInsurance Crime Bureau estimates, fraud against property-casualtyinsurers costs Americans $30 billion every year, which translatesinto an additional $200 to $300 per year per household forinsurance premiums.

But on the positive side, she pointed out that the percentage ofthose who accept claims padding, while still high, has beensteadily falling in the past few years. The 33 percent willing topad claims to make up for deductibles represents a slight decreasefrom 2000, when the figure was 35 percent in a similar study.

The 22 percent figure for those willing to boost the claimsamount to make up for premiums paid also represents a decline from2000, when the number was 24 percent.

"Despite the fact that many Americans continue to tolerateopportunistic fraud such as claim padding, the survey results areencouraging," Ms. Sprinkel said. "They suggest that, compared toprevious years, the public is becoming less tolerant of all formsof insurance fraud."