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By Barry Zalma
Some people act too smart for their own good. They want to commit a fraud but don’t know how. In so doing, they hurt themselves rather than help.
When I was a young insurance adjuster, twenty-five years ago, the company I worked for insured a homeowner who owned a Capuchin monkey as a pet. The monkey was a friendly sort. He did not like confinement to the house.
One day, when the insured was not looking, the monkey escaped. He was a pet and did not want to run away. He just wanted out of the house. His escape, therefore, led him to the roof of the next door neighbor’s house.
The next door neighbor had a tile roof. The monkey’s sharp little toenails made an infuriating clicking noise as he ran back and forth on the tiles. The neighbor, unable to stand the noise, came out of the house and saw the monkey on the roof. The insured was not home. The noise was unbearable. Not only did he scratch his nails on her roof, but he chattered incessantly. She yelled at him to no avail. She picked up stones from her yard and began throwing them at the monkey. She did not know how aggressive little wild animals can be. The monkey took offense when hit by a stone. He jumped to her shoulder, sinking his claws through her thin cotton shirt and taking a bite out of her neck.
The insured returned home at about the same time, and she patiently removed the monkey from her neighbor’s neck and applied first aid. The insured reported the incident to her insurance company, and I was assigned to adjust the claim. I made contact with the neighbor, who informed me that she was a good woman. She said she did not wish to take advantage of her neighbor. She had gone to her doctor who applied anesthetic and a bandage. The doctor told her to clean the wound out daily with hydrogen peroxide and place new dressings on it for a week. She wanted only to be paid her doctor’s $100 office visit charge, $5 for the bottle of peroxide and $1 for the bandages.
Since liability appeared clear, I readily accepted her offer of settlement. The claimant did not ask for any recovery for her pain and suffering. She did not ask to be paid for the trouble and inconvenience she went through to have her wound bandaged.
I thought I had an excellent settlement. I told the claimant I would send her a check and asked, only, that she allow me to complete my file by sending me the doctor’s bill and the receipts for the peroxide and bandages.
The check, with the release printed on the back, went in the mail that day. It was negotiated by the claimant immediately. The receipts and billing from the doctor appeared the next day in my office.
Normally they would have just been filed without a glance, the file closed and put away. This time, I was waiting for a telephone call from a private lawyer to settle a $100,000 case and had time on my hands. I looked at the doctor’s bill she sent me and found that it was an original carbon. The doctor kept the original bill and gave the claimant a carbon copy. On the carbon, for the office visit charge, were the numbers one and zero in blue ink, followed by an additional zero in black ink.
The claimant, who for an injury of her type, could have easily talked me into paying her $1,000 to $3,000, mistakenly thought she had cheated me by changing a $10 doctor bill to a $100 doctor bill. In so doing, she gained $90 and lost $3,000.
Her fraud was a success. We did nothing. We reported the fraud to no one. The insured owed the claimant much more than the $106 we paid her. The claimant probably thought she committed a brilliant fraud. This time the person actually damaged by the fraud was the fraudster, not the insurance company.
Adjusters must always keep in mind that when they receive a claim that seems too good to be true, there is a very high probability that it is, in fact, too good to be true.
Barry Zalma of the Culver City law firm of Barry Zalma, Inc., is also the president of ClaimSchool, Inc. and the publisher of How Your Friends & Neighbors are Screwing You. He can be reached at (310) 390-4455.
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