Insurance fraud exists when individuals attempt to profit by failing to comply with the terms of the insurance agreement. Fraud can occur at any stage of an insurance transaction by any of the following:

  • Individuals applying for insurance
  • Policyholders
  • Third-party claimants
  • Professionals who provide services to claimants


The cost of insurance to consumers continues to grow each year due to the huge losses that occur within the insurance industry. Most carriers can only estimate what they lose to claims that are discovered to be fraudulent. Insurance fraud is not limited to one group, race or gender. It is an equal opportunity crime that can be performed by an insurer or an insured.

Atlas Glinn can evaluate anti-fraud technology and transform that data into knowledge. This allows Atlas Glinn Investigators the ability to leverage internal and external data for a successful investigation. Insurance related fraud today is more complex and sophisticated, requiring a much greater analytical and intelligent approach.

ATLAS GLINN’S SOUND BUSINESS STRATEGY AND TACTICAL BUSINESS PROCESS INTEGRATED WITH TECHNOLOGY ALLOWS US TO BE SUCCESSFUL.

However, technology alone will not be effective without an integrated business process. Technology will certainly help to identify questionable claims, but there must be some follow-up after the claim has been flagged. Proving insurance fraud still requires a thorough investigation, skilled and well-trained investigators.

Quality investigations are essential in fighting fraud and no amount of technology can serve as a substitute for the knowledge and experience of a good investigator.

The purpose of a Third-Party Investigation is to:

  • Protect the ability to minimize an insured’s exposure in third-party cases.
  • Allow the insurer to protect their own interests and prevent collusion.


Prompt notice of an accident or claim provides an insurer with the opportunity to conduct a timely and thorough investigation which helps to protect against fraudulent claims.

Perhaps the first step in investigating a suspicious claim-or any claim for that matter-is to obtain the preliminary statement of the insured or third-party claimant. The purpose of this statement is to get a brief sketch of the facts and circumstances surrounding the loss. The insured or claimant should be asked for the basic facts about how the loss occurred. Background questions should also be asked, as well as basic questions about the insured’s financial condition where appropriate. To avoid lapses in memory, the statement should be conducted as soon as possible after notification of the loss is provided by the insured.

Recorded statements should be taken at the earliest possible opportunity. It is important to keep in mind that in many states, including Texas, all recorded statements are discoverable, including recorded statements by the insured defendant. Insurers should keep this in mind when deciding who to take a recorded statement from and whether to take a recorded statement from their own insured.

The preliminary statement of the insured is not designed as a substitute for the EUO. According to most court decisions, a voluntary statement given by the insured will not relieve them of their obligation to later submit to an EUO as required by the policy.

Taking an effective recorded statement is the most effective weapon in the fraud investigator’s arsenal. The recorded statement is often the first and sometimes only, opportunity for the fraud investigator to interact in depth with the claimant or insured being interviewed.

Atlas Glinn Investigators conduct the bulk of claims investigations. They personally contact the policyholder, and often conduct on-site investigations of the accident scene when appropriate.

The investigation process typically will include employer interviews, taking of statements from witnesses, injured worker, and other parties. Atlas Glinn Investigators seek to establish any information or fact which may be relevant to the claim including the history, and background of the injured worker. Outside factors which may have an influence on the claim, or other credibility issues might also be explored.

An objective report, based on fact, and supported by documented evidence, provides you with pertinent information necessary to consider when making a determination on the claim. Supportive documentation gathered for you may include payroll, and attendance records, employment application, and other personnel records, as well as any company policies, and procedures. Credibility issues may be supported by other external witness statements, such as past employers, friends, relatives, or by other documents that might include items such as police or court records.

Investigations are appropriate when there is visual need for in-person, on-site investigations in order to gather the information necessary for claim decisions, or when in person interviews are indicated. Most attorney represented worker interviews are conducted in person.

Without a doubt one of the most powerful investigations in the industry today is the Activity Check. Activity checks are designed to provide insight into a subject’s activities, interests or whereabouts. Activity Checks are a cost effective, efficient alternative to other costly investigations.

Your investigation should determine whether an individual’s level of activity is or is not consistent with their claimed condition and restrictions. The goal of an Activity Check is to know more about the worker when you finish than you did when you started.

Benefits

  • Complete Data base research
  • Cost effective alternative or pre-cursor to Surveillance
  • Allows claims professional the opportunity to assess the investigative needs of a file in a cost-effective manner.
  • Quick turnaround time during significant claim activities
  • Establishes the foundation for future investigative needs

Why an Activity Check Would Be Conducted

  • Establish activity level of Subject
  • The recovery or settlement of a claim is taking longer than expected
  • There is an indication that a subject is more active than indicated
  • There is a credible lead that the subject is active and/or working while collecting disability
  • The subject is not cooperating with claim resolution efforts
  • Confirmation of activity level for purposes of establishing accurate disability ratings


How to Prepare for an Activity Check

  • Obtain a complete physical description of the Subject
  • Provide a complete overview of the subject’s limitation and abilities.
  • What are the upcoming significant events in a claim – Medical appointments, legal proceedings, settlement discussions, mediation, RTW
  • Determine what the goal is for the Activity Check – Don’t spend resource without purpose

Experience has shown us that some injured workers will prolong their return to work by malingering or exaggerating their disabilities. Surveillance investigations should be initiated when you have good reason to believe the worker is misrepresenting his / her disability, and when visual evidence can be utilized or be a benefit in closing or managing the claim. In those instances, conducting covert surveillance and gathering video evidence of the injured worker’s disability and activity level is necessary to manage the claim effectively and avoid paying undeserved benefits.

Surveillance video may also be beneficial – or necessary in some cases for establishing evidence that supports a fraud investigation and resulting in criminal prosecution. The goal in the fraud investigation is to determine whether fraudulent activity has occurred and to identify the course of action that should be pursued. That may lead to a recovery method that would include collection of monies owed, or civil / criminal prosecution.

There are three main categories of fraud investigations: worker, employer and provider. You may recognize the indicators when dealing with the injured worker, but there are other red flags that may alert you to the need for further investigation of other types of possible fraud.

Criminal prosecution differs from the WCB Hearing arena, in that we must establish Proof Beyond a Reasonable Doubt rather than a preponderance of evidence (which may suffice at the Hearings level). There must be an opportunity for fraudulent activity.

  • You must establish monetary or other loss
  • Crime-the action must be a criminal offense
  • Intent (motive) – you must establish that the individual knew of or intended to commit the crime

EFFECTIVE SURVEILLANCE REDUCES THE PAID COSTS ON CLAIMS

CHARACTERISTICS OF SURVEILLANCE
“HIGH HIT” RATIO CASES: (LIKELY TO OBTAIN POSITIVE RESULTS)

  • DOCTOR / IME / PT appointments (film likely, usefulness depends on individual case.)
  • Employer has knowledge of worker’s activity level and off work habits/hobbies.
  • Detailed vehicle description.
  • Workers residence is in a location where direct surveillance can be established.
  • Good physical description of
  • Worker has significant restrictions and is known to be exceeding them away from
  • Medical provider is unable to find basis for worker’s excessive complaints of
  • Activity Check with neighbors indicates worker is gone during much of the
  • Worker is never home when adjuster
  • Worker has history of claims with employer at specific times of the year (when weather is nice, hunting season )
  • Adjuster has specific reason to suspect worker does not want to return to work (must care for an elderly parent, was getting ready to quit).
  • Worker filed claim with knowledge that he / she was getting ready for seasonal layoff.
  • Chart notes from the medical exam indicate activity (hunting, callused hands).

CHARACTERISTICS OF SURVEILLANCE
“LOW HIT” RATIO CASES: (LESS LIKELY TO OBTAIN POSITIVE RESULTS)

  • Geographic limitations prevent line of sight surveillance
  • Worker is back to work (either full or part time)
  • If worker is obese, they are less likely to be active
  • Worker has pre-existing medical problems which indicate a low level of activity
  • Prior surveillance investigator was spotted, and worker is suspicious
  • Unknown physical address, worker uses PO Box for mail
  • Prior investigations indicate lack of activity
  • No prior investigation completed (Statement / Activity Check)
  • Injury is not readily visible (stress, psych, headaches, sensitivity to loud sounds )
  • Worker has more than one last name
  • Worker lives in a remote area or small town where unknown vehicles stand out
  • Worker’s restrictions are such that most surveillance would be unusable (no lifting over 50 ponds, no walking over 2 miles)

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