Guiding consumers since 2009

Insurance Fraud - Are you legally alive?

By Staff Writer

Insurance Fraud - Are you legally alive?

Insurance fraud and identity theft are on the rise. You have to wonder... are you legally alive?

With more and more people becoming strapped for cash, certain individuals are taking it to the next level and turning to insurance fraud for a new found source of income.
It has reached the point that the Department of Home Affairs is now calling on South Africans to check if they are ‘legally alive' as fraud regarding identity theft is increasing - the latest trend for these criminals is to fake peoples' deaths in order to benefit from life insurance policies.

Insurance expert Amman Rampersad of InsuranceBusters says, "Fraud in the insurance industry is not to be taken lightly. If companies and consumers aren't vigilant about reporting and addressing fraudulent behaviour, insurance premiums will keep on rising due to the losses made by the industry."

In South Africa alone it is estimated that fraud costs our economy in excess of R2 billion per year. This figure is forecasted to rise substantially due to the recession and its impact on consumers.

Other fraud ranges from over-claiming, claiming for extras that weren't actually in ownership, to creating fake accidents, hijackings etc. This may seem like a simple money making technique that won't harm anyone - but as all get-rich-quick schemes, this is too good to be true.

Insurance companies and brokers nationwide are clamping down on fraud in a big way. Brokers and consultants have been instructed to be aware and vigilant about any suspicious behaviour
The South African Insurance Crime Bureau (SAICB) has also entered into an agreement with the South African Fraud Prevention Service (SAFPS) whereby they will share confirmed data on people who have defrauded any of their member organisations. This information will also be shared with all of South Africa's major banks, major retailers, asset finance organisations and micro lenders.

As far as implications for other consumers is concerned, it is simple. The insurance industry is losing money annually due to fraud - therefore they need to hike up insurance premiums in order to make up their loss.

This means that as the average law abiding consumer, we are inadvertently being punished for the crimes of others. We could be spending far less on our insurance premiums, which as we know are essential, if these fraudulent criminals were stopped. This is why it is important for every consumer out there to report any and all suspicions of fraud. By doing this you will save not only our economy, but yourself money.

 

Recent Articles

Featured Can you take out vehicle finance on an old vehicle?

As it turns out, creditors have several concerns regarding cars older than 10 years. Justmoney has a look at why creditors are sceptical of older vehicles and what you can do to get around this.

Should you have a living will in place?

When you hear the word will, the only thing that comes to mind is the document that states who is going to inherit you property when you’re dead. But have you thought about who’s going to decide what happens to you when you become incapacitated? A living will can help you do just this.

Know the difference between a loan and a credit facility

Choosing the correct product according to your needs is critical in making smart financial decisions. Credit options can be separated into two main categories – loans and credit facilities. But for some people, the lines can be quite blurred between the two.

Is property a good investment?

It’s good to consider whether property is a good investment. Justmoney spoke to numerous specialists to find out whether this is the case in South Africa.

Deals

DaVinci’s on Kloof Students Discount

Price: Available on request
When: Daily
Where: Cape Town

Ghandi's Backpackers and Guest Lodge 10% Discount

Price: Available on request
When: Daily
Where: Johannesburg

Fairway Hotel Happy Hour Special

Price: Available on request
When: Until 13 December 2019
Where: Johannesburg