Page 248 - Ebook health insurance IC27

The Insurance Times

This is a long cycle where the policies are issued in false name, giving false address.
Thereafter false claims lodged against those policies by producing fake documents.

Insurance companies use tools like underwriting scorecards which rates the person
based on profile and financial strength. This software can help to know if such persons
are frequently lodging the claims.

Stages of insurance frauds

a. Fraud possibilities at proposal and policy stage
b. Frauds during the contractual period
c. Frauds during the claims stage

Fraud possibilities at proposal and policy stage

A. Disclosure of material information in the PROPOSAL FORM
 Insurance is a contract of utmost good faith and insured must disclose all the possible

details correctly as asked in the proposal form.
 If any information is material to the risk the proposer should mention it in the proposal

form even if there is no specific information pertaining to it.
 The insurers would design its proposal form carefully so as to include all possible

questions which might help in disclosing material information.

B. Disclosure of material information at the MEDICAL STAGE
 The insurer may ask for medical examination report if the sum insured is higher or

age is higher or if any adversity is noted in the proposal form.
 The medical examinations should be done with the empaneled doctors/clinic of

the insurer

252 Guide for Health Insurance