Fraud/concealment/misrepresentation

[J Buscavage]

Hi,
I'm studying p & c insurance and am struggling understanding the concepts fraud, concealment, misrepresentation, etc. It seems to me that these terms are all so similair and have such minor differences. Does anyone have a good way to remember the differences that they use?

 

[goillini52]

Hi,
I'm studying p & c insurance and am struggling understanding the concepts fraud, concealment, misrepresentation, etc. It seems to me that these terms are all so similair and have such minor differences. Does anyone have a good way to remember the differences that they use?

Seems to me that it's self explanatory.

 

[adjusterjack]

Memorize the following and you'll do fine:

Fraud requires intent to defraud and can get you put in prison in addition to losing the insurance and getting the claim denied. Examples: Setting fire to your property to collect the insurance, faking an injury in an auto accident, having your spouse killed so you can collect his/her life insurance.

Concealment is the omission of information material to the underwriting of a risk. Misrepresentation is providing untrue information material to the underwriting of a risk.

Concealment and misrepresentation can result in denial of claims and rescission of policies.

Fraud, concealment and misrepresentation are often discovered when a claim is filed and investigated.

Concealment and misrepresentation need not be intentional but whether intentional or not, they need to material to the underwriting of the risk.

Materiality has been defined by the courts to include one or more of the following elements.

1 - The insurance company would have declined to insure the risk.

2 - The insurance company would have charged more for the risk.

3 - The insurance company would have excluded the undesirable hazard.

 

[Markthebroker]

Hi,
I'm studying p & c insurance and am struggling understanding the concepts fraud, concealment, misrepresentation, etc. It seems to me that these terms are all so similair and have such minor differences. Does anyone have a good way to remember the differences that they use?

For what it's worth, the ethics portion of the continuing education and testing is always the hardest for me. The reason is I always try to do right and help my clients, and don't even consider ways to cheat or screw people. It's honestly too much work and affects my ability to sleep.

So, when it comes to answering questions about it on a test, it's all just "bad" to me. Identifying one type of f#ckery vs. another type of f#ckery is always confusing to me, because it's all just "bad" or "wrong" in my head, and there isn't a lot of difference from one to the other. It's all just sh#tty.

 

[marindependent]

As adjusterjack so eloquently said: "Concealment and misrepresentation need not be intentional but whether intentional or not, they need to material to the underwriting of the risk." I think that this is the most salient point to remember, frankly. While Fraud is well basically a scam to get money.

 

[LostDollar]

For what it's worth, the ethics portion of the continuing education and testing is always the hardest for me. The reason is I always try to do right and help my clients, and don't even consider ways to cheat or screw people. It's honestly too much work and affects my ability to sleep.

So, when it comes to answering questions about it on a test, it's all just "bad" to me. Identifying one type of f#ckery vs. another type of f#ckery is always confusing to me, because it's all just "bad" or "wrong" in my head, and there isn't a lot of difference from one to the other. It's all just sh#tty.

I was impressed when I first saw that post, but now I think I am going to take it as a post representing situational ethics, AFTER just running on to another recent post of yours in which you seem to talk about regular law breaking by the time you get to the office.

 

[goillini52]

I was impressed when I first saw that post, but now I think I am going to take it as a post representing situational ethics, AFTER just running on to another recent post of yours in which you seem to talk about regular law breaking by the time you get to the office.

Are you saying that Mark isn't an ethical person?

 

[Markthebroker]

Are you saying that Mark isn't an ethical person?

By the time I've gotten to the office, there's a good chance I've gone slightly over the speed limit, rolled a stop sign, jay walked or also made an illegal u-turn. I actually bring that example up often on this forum to display the gap between severity of laws broken, and actual enforcement.

 

[goillini52]

rolled a stop sign, j

Ahhh, the "California Roll".