The recent case of a café owner who used his insurance payout to buy gold bullion for his family rather than pay creditors, raises the important role brokers can play in fraud, according to a private investigation firm.
Bill Katsabis received an insurance pay-out of $580,000 from Wesfarmers when his café was destroyed in a fire. The money could have been used to pay off his creditors, but instead he put some of the money in the bank accounts of his wife and children, and bought almost $60,000 worth of gold bullion and spent $20,600 on four wrist watches.
Insight Intelligence says insurance sales and claims made over the phone or internet make it harder for the insurance community to spot fraud but brokers can play a key role.
It says there are key signs of fraudulent activity. They are:
- Overinflated claim [claiming more than should be]
- Claimant is pushy to give a short statement
- Suspiciously coincidental absence of insured or family at the time of the incident
- Prior claims for similar claims or claims with different insurance broker at the same time claim being made for one claim
- Losses are incompatible with insured's residence, occupation and/or income
- Losses include a large amount of cash
Mario Bekes, CEO Insight Intelligence said: “Spotting fraud is still a challenge for the insurance industry. With the right tools and an increased knowledge of what to look out for the industry can make a huge impact to reduce this crime.”
