Being insured in the simplest sense is like any other financial agreement that different people enter into everyday. Car insurance as an agreement can be too tempting to abuse because it holds a lot of benefits. The monetary benefits alone from compensations can bring back the premium rate paid by policy holders in many folds. Due to this profiteering possibility a lot of individuals fall into fooling themselves that they can outmatch the insurance system and start making a lot of profit from it. Lying is the main source of indemnity related crimes that policy holders get themselves into without considering its dire consequences.
Policy holders can lie to car insurance companies in two major grounds- application and claim. Getting a low cost car insurance policy can sometimes push people to their limit. Policy shoppers in applying for their indemnity policy sometimes lie in some vital details needed in computing for their premium rate. There are cases where policy shoppers lie in telling their age, model of owned car and even address of residence.
In the application process, policy holders sometimes pretend that they are much older since younger drivers are considered to be riskier. If they appear as less risky then they can enjoy lower premium rates. Some also lie in detailing the car model they are driving, especially if they are luxury cars or vintage cars. Luxurious car models alongside with old models will require higher premium rates to compensate for the high expense in compensating for its future possible damages. Luxury cars are also more prone to theft and robbery. There are even cases where the policy shopper accounts a different address to avail a car indemnity policy with lower premium rate using a different state’s limit through a different address.
Policy holders can sometimes try to cheat their insurer by staging situations wherein claims can be filed for. It is inevitable that some policy holders would try to utilize their insurance since they are paying for it too. Unfortunately, the indemnity system is just as secured and tedious as any other financial business. Every indemnity company has its own team of claim checkers. These teams check the validity of the claims filed by policy holders.
In the event that indemnity checkers find out that the policy holder or any party has lied in either application or claim, the insurer will be empowered to take legal actions against those who lied. Any car insurance policy holder who has been proven to have lied in any of the grounds will end up having hard time applying for other financial accounts. The claims of this policy holder will almost always be denied even if its grounds are valid.
