How to Avoid Insurance Frauds

Insurance Frauds and Scams: How to Avoid It?

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As long as the demand for insurance increases, so will the unfortunate possibility of falling prey to insurance frauds. Fraudsters constantly endeavour to come up with new and innovative ways to reap the benefits of your hard-earned investments, which is why you need to be alert and follow certain best practices.

Here are Some Ready Tips to Ensure that You Never Fall Victim to an Insurance Fraud:

Ask the insurance Agent for ID Proof

According to strict directives issued by the IRDA to insurance agencies, all agents working on behalf of insurance companies need to undergo stringent training and also need to acquire a proof of identification. If an agent approaches you, you should first ask for their ID, note down their details and call the customer care service number of the insurer to confirm their identity. This is a safety measure proposed to save you from falling victim to insurance fraud cases.

Never Pay in Cash

No insurance agent will ever ask you for cash. Also, in order to ensure that you are writing the cheque to the right account, you should call the customer care centre and confirm the details to be mentioned on the cheque. This will ensure that you do not unknowingly write a cheque to an agent who will deposit the funds under a similar-sounding name and fall victim to one of many possible insurance frauds. Even if an agent is representing a private firm, the details on the cheque should be for the insurance company and not for any such firm.

Do Not Disclose Details of Your Policy

Divulging details of your policy documents to an unknown third party is a sure fire way of attracting insurance fraud cases. Sometimes, a fraudster might pose as an insurance agent, asking you for details about your policy. They can either pose to be consumer rights personnel or claim to be calling you from the service centre of the insurance provider. If they call and ask you if you have any complaints about your insurance policy, you should be on the red alert.

Purchase Insurance Policies Online

If you would altogether like to avoid the risk of insurance frauds and buy insurance policies without having to deal with an agent, you can instead, purchase your policy online. Not only will this cut out the middleman, but also guarantee a safe and transparent transaction. Make sure you follow the payment steps and do not disclose your credit card information to anyone. Also, check to confirm that you only make payments on the insurance provider’s recommended site, as it will have a secure SSL-enabled payment gateway.

Immediately Report Loss of a Policy Document

Fraudsters might gain access to your policy documents and make a claim in your name. This is why you should your insurance documents in a bank locker, if need be, and make copies of them as well. Immediately notify the insurance fraud investigator in the event that you misplace or lose your documents. In most cases, you are required to lodge an FIR, place an advertisement in the newspapers and also provide the insurer with an indemnity bond on stamp paper.

Ensure that You Write Policy Documents Yourself

If you choose to go via the offline route when purchasing insurance, you should ensure that you fill in the policy documents yourself to avoid insurance fraud cases. Read and understand the terms and conditions, inclusions and exclusions, and check for spelling errors, withholding of information and misrepresentation of facts, if the policy document is being filled in by an agent on your behalf. Do not sign on any policy documents unless you have read it through and through.

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Provide Identity Proofs Only to Reliable Personnel

Agents might take your ID proofs and misuse them. You should ensure that you hand over your ID proofs only to reliable agencies, to prevent identity theft and insurance fraud cases from taking place.

Be Careful When Transacting from the Internet Kiosks or Public Networks

Electronically perpetrated insurance fraud cases are on the rise. Wi-Fi networks can be used by scammers to steal your personal information. Be careful while transacting via these networks or accessing personal information; make sure you sign out of all public computers after using them and use encrypted connections when you make payments online.

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