Fake Claims

AAA

DEFINITION of 'Fake Claims'

The term fake claims refers to insurance claims that are made fraudulently. These claims are made in an attempt for the policy holder to benefit financially from making claims that are false or exaggerated. While such practices are a fairly common occurrence, they are highly illegal.

INVESTOPEDIA EXPLAINS 'Fake Claims'

Fake claims are often exaggerations of valid claims to an insurance policy. For example, a homeowner insurance policy holder may have been the victim of a breaking and entering where items were stolen. The number (and value) of the stolen items may be exaggerated on the claims report, indicating that more items were stolen than really were. This exaggeration could lead to the homeowner receiving a larger claim settlement than that to which he or she is truly entitled. Large claims are often investigate to mitigate such problems.

RELATED TERMS
  1. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt ...
  2. Unintentional Tort

    A type of unintended accident that leads to injury, property ...
  3. Medicare And Medicaid Fraud

    Illegal practices aimed at getting unfairly high payouts from ...
  4. Windstorm Insurance

    A special type of property-casualty insurance that protects policyholders ...
  5. Business And Personal Property ...

    Provisions of a business insurance policy that provide coverage ...
  6. Auto Insurance

    A policy purchased by vehicle owners to mitigate costs associated ...
Related Articles
  1. Insurance Tips For Homeowners
    Insurance

    Insurance Tips For Homeowners

  2. Understanding Your Insurance Contract
    Insurance

    Understanding Your Insurance Contract

  3. How An Insurance Company Determines ...
    Home & Auto

    How An Insurance Company Determines ...

  4. The History Of Insurance In America
    Home & Auto

    The History Of Insurance In America

Hot Definitions
  1. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  2. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  3. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  4. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  5. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  6. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
Trading Center