Alabama Commercial Lawyers Helping with Insurance Concerns

Insurance may not be the most glamorous topic, but it is an essential element of everyday life. Whether for an individual or a business, insurance policies will comprise a crucial element of your daily paperwork and can offer a much-needed safety net in the event that things go wrong.

In some cases, however, an individual may find themselves at the wrong end of an insurance fraud case, and the consequences if you are found guilty can have a negative impact on the rest of your life. If you find yourself in this situation, it is crucial that you are able to access trustworthy, reliable legal advice.

What is Insurance Fraud?

Insurance fraud comes in many forms and seems to be increasingly common. Statistics from the FBI estimate the total price of insurance fraud in the U.S.are, on average, over $40 billion per year, with the average family paying between $400 and $700 per year as a result.

This is a vast legal area and is described by Alabama legislation as being:

“A person commits the crime of insurance fraud if, knowingly and with intent to defraud, he or she commits, or conceals any material information concerning, one or more of the following acts:

(1) The solicitation or acceptance of new or renewal insurance risks on behalf of an insurer, reinsurer, or other person engaged in the transaction of the business of insurance, by a person who knows the insurer, reinsurer, or other person responsible for the risk is financially unable to pay its claims at the time of the transaction.”

An individual may also be found guilty of insurance fraud if they are involved in embezzling or stealing funds intended for an insurance fund, presenting false information or misrepresenting details, or “making adjustments to any records or assets relating to the transaction of the business of insurance of an insurer, reinsurer, or other person engaged in the transaction of the business of insurance.”

What are the Types of Insurance Fraud?

Some of the primary types of insurance fraud include:

• Making False Claims: making a claim for an accident which never occurred, an accident which was staged for the purposes of claiming insurance, or for work which was never carried out are all common forms of insurance fraud. Slips and trips are the most common accident to be fraudulently reported, as they tend to have high pay-outs and are tricky to prove. Auto owners may also deliberately damage their own vehicle to make a claim, allowing them to access a pay-out or a new car for a reduced cost. In some cases, claimants make a statement for damage which is not accidental (e.g., if damage is the result of arson).
• Overinflated Claims: even if the claim is legitimate, the figures involved may not be. Homeowners are particularly guilty of this; they can be tempted to put in claims for work which was never carried out, items they never owned, or an upgrade to an existing item. This is particularly common following a natural disaster or major incident.
• Faking a Death: faking your own death is more common than you may have anticipated and can be seen by policyholders as a chance to cash in on a great payday. The policyholder will take out a significant life insurance policy before faking their own death,the pay-out goes to the beneficiary, who is usually in on the scam, and the money is shared between them.

What are the Consequences of Insurance Fraud?

If you are found guilty of insurance fraud in Alabama, the consequences can be severe. If the loss or potential loss exceeds $1000, it is counted as a Class B Felony. Those found guilty face 2-20 years in prison. Any loss or potential loss under $1000 will be labeled as a Class C Felony and can earn the recipient up to 10 years in prison.

What Can I Do?

If you find yourself accused of insurance fraud, it is crucial that you seek experienced, trustworthy legal advice as soon as possible. Here at Pharr & Associates Injury Attorneys, we have a wealth of experience in assisting individuals who have been accused of insurance fraud. Our team has the skills to help you take the next steps and work your way towards the most favorable outcome for your circumstances. Call us today at (256) 487-6080 and receive a free consultation to get the help you need.