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When a claim report for an automobile fire is made, it is very important to treat the claim as legitimate to avoid offending good customers or alerting potential defrauders. The following list of fraud indicators will help alert the clever claims investigator to a possibly fraudulent claim:
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The loss occurred close to the start or end of the policy period, within two months of inception or a month of expiration or cancellation.
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The coverage was recently increased.
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The origin of the fire and/or its cause are suspicious or unknown.
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The insured is unemployed.
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The loss was not reported to the police or fire department.
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The loss occurred in a remote area after 11:00 P.M.
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The vehicle had been advertised for sale.
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The vehicle was reported stolen then recovered a short distance from the insured’s home.
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The insured is involved with domestic problems, litigation or is experiencing financial difficulties.
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The vehicle was rebuilt, recovered from a previous theft or had been involved in a major collision.
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The vehicle is a late model but has high odometer readings.
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The vehicle was stripped prior to the fire.
When a possible fraud is indicated, the following steps should be taken to investigate whether the claim is honest or fraudulent:
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Relay information about the claim to the company’s fraud unit.
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Check the insured for multiple claims through any available data bank.
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Review the claim filed by the insured.
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Review the policy history to check time in force and any claim history. Are there large numbers of claims by the insured or any pattern of types of losses?
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Take a recorded statement of the insured’s description of the loss.
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Review the police report and note who reported the fire, who was present at the scene and any statements the insured or any witnesses may have made.
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Take a recorded statement from any witnesses.
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Inspect the vehicle for any evidence of the following: fuel system component damage; electrical system component damage; fragments of matches, paper or rags; signs of accelerants, especially gasoline outside the gas tank; keys in the ignition and ignition “on”; melted window glass; distended seat springs; window tracks in the “open” position; personal belongings in the glove box, passenger compartment and/or trunk.
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Review the insured’s credit history, paying special attention to the actual car loan or car lease contract.
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Search courthouse records for liens, judgments, pending cases for property settlement and divorce cases.
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Compare the reported cause and origin of the fire with fire department records.
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Compile the findings and determine the motive, the opportunity and the intention.
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