Frauds in insurance sector icai fafd presentation - public
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Transcript of Frauds in insurance sector icai fafd presentation - public
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Frauds in Insurance SectorA Presentation byGROUP - IIPune January 2014 Batch of Certificate Course onForensic Accounting and Fraud Detection
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Introduction
Fraud in Insurance may take place in various stages like:◦ Fake Insurance Policies◦ Fake Customers◦ Fake Declarations◦ Fake Claims◦ Fake Claimants
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Classification of Frauds
Insurance Frauds are broadly classified as: ◦ Hard Frauds: (Fake Auto Theft, Fake Fire
thefts, or collusion frauds etc. – Here the claim itself is questionable).
◦ Soft Frauds: (Opportunist frauds – here claim amount is exaggerated on an otherwise legitimate claim).
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Frauds in Life Insurance
Issue◦ Fake customers◦ Misrepresentation of Facts: Age, Health
Claims◦ Faking death claims◦ Fake claimants
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Frauds in Medical Insurance
Issue◦ Misrepresentation of Facts: Age, Health
Claims◦ Fake injuries / illness◦ Exaggerated injuries / illness◦ Inflated medical / hospitalization bills
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Frauds in Personal Accident Insurance
Fake CustomerFake Accident / Disability / DeathFake Claimant
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Frauds in Motor Insurance
Issue◦ Fake / forged Documents◦ Misrepresentation of Facts
Claims◦ Fake accidents / repair bills◦ Inflated repair bills◦ Tampered repair bills◦ Fake third-party claimant
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Frauds in Marine Insurance
Fake shipmentMisrepresentation of value, quantity, qualityFake in-transit theft
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Frauds in Fire & Burglary Insurance
Fake stock / assetMisrepresentation of value, quantity, qualityFake fire / burglary claims
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Frauds in Asset / Machinery Insurance
Fake assetsMisrepresentation of value, quantity, qualityFake breakdown / damage claims
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Red Flags
Abnormal delay in submitting claim / document
Absence / discrepancy in key documentary evidence
Abnormal urgency to settle claimAbnormally large claim vs. usual businessConvenient AlibiRecent policy / increase in Sum Assured
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Situations involving Insurance Fraud
Mr. 420, a teacher, takes a Personal Accident policy of Rs. 42 Lacs on his 42nd birthday
M/s. Toliyawalla & Safediwalla’s export consignment was rejected by their Bangkok customer
F Company takes a Group Medical / Health Insurance policy on its 1200 employees
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Presented By Group II Members
Roll No.Name Member No.CA Kulkarni Prakash Purushottam CA Gupta Satya Prakash CA Parakh Vinod Kumar CA Doshi Sunny RajendraCA Newaskar Ranjit Raghunath
Thank You
Distrust the obvious and apply professional skepticism