Fraud is an illegal act characterized by deceit, concealment or violation of trust committed by individuals and organizations to obtain money, property or services, avoid payment or loss of services, or to secure personal or business advantage.

As the services we buy every day continue to increase in cost, it is important to understand the role that fraud plays in these ever rising insurance prices. We may not be aware of it, but fraud committed by sophisticated criminals, and consumers can increase costs dramatically. In the Financial Services industry alone, over $400 billion is lost to fraud every year. It is estimated that fraud claims alone cost society nearly $80 billion each year nationally, or about $940 for every family in the United States. These losses divert vital resources away from business, law enforcement, the civil justice system, and local emergency services. The costs of fighting fraud include: detection and prevention techniques that are implemented by insurance carriers, the NYS Insurance Department, and law enforcement. The costs are passed on to the consumer, which increases prices for everyone. To reduce these costs, we should all act collectively and report fraud whenever it is suspected.

By creating Special Investigations Units, often staffed by former law enforcement professionals, major insurers work to detect and investigate suspicious claims and other activities. In addition to the efforts of individual companies, not-for-profit organizations such as the National Insurance Crime Bureau were created to fight insurance fraud. Many companies that we represent participate in the work of this organization. This year, a new fraud fighting coalition was formed. Many companies have joined the Coalition Against Insurance Fraud. This group has broader representation including consumers, government agencies, and insurers dedicated to combating fraud through public education and advocacy.

Lighthouse Insurance actively participates to help combat fraud through a series of public service campaigns involving several of our insurance carriers (partners in business). Additionally, Lighthouse Insurance also attempts to educate our clients on the potential consequences of fraudulent claims and the cost to our society. We also conduct fraud awareness training for our sales and customer service associates to help recognize the signs of potential fraud.

To report suspected fraud you may do any of the following: If you suspect insurance fraud, you can report it to the Frauds Bureau by calling 1-888-FRAUDNY (1-888-372-8369). A Frauds Bureau investigator will contact you for details and the matter will be kept confidential.

Contact the National Insurance Crime Bureau's (NICB). If you suspect potential insurance fraud or vehicle theft, please be sure to call the toll-free consumer hotline at 1-800-TEL-NICB (1-800-835-6422). Or contact them at www.nicb.org/index.shtml.

According to the National Insurance Crime Bureau (NICB) the ten most commonly stolen vehicles in the United States in 2000 are:

1. Toyota Camry
2. Honda Accord
   
3. Oldsmobile Cutlass
   
4. Honda Civic
   
5. Jeep Cherokee/Grand Cherokee
   
6. Chevrolet Full Size C/K pick-up
   
7. Toyota Corolla
   
8. Chevrolet Caprice
   
9. Ford Taurus
10. Ford F150 pick-up