“If you tell the truth, you don't have to remember anything.” ― Mark Twain.
Unfortunately, some people don’t always tell the truth when they’re making an insurance claim. When a claim looks suspicious, that’s when SGI’s Special Investigation Unit (SIU) comes in. The SIU is a team of employees, all with law enforcement backgrounds, who work to prevent fraud and keep rates low for SGI customers.
“When you lie about an insurance claim, you’re committing insurance fraud,” said Penny McCune, Executive Vice President and Chief Operating Officer of the Auto Fund. “The truth is those lies have real consequences. It starts with the denial of your claim, leaving you on the hook for thousands of dollars. Those lies could also land you in legal trouble, because insurance fraud is a crime.”
Every time a fraudulent claim is paid, honest insurance customers pay the price in higher insurance premiums. March is Fraud Prevention Month and SGI is once again highlighting the work the SIU does to keep insurance rates low in Saskatchewan. The SIU closed 1,700 files last year. Not all of them were fraudulent, (and SIU is just as happy to find out there is no fraud related to a claim) but the ones that were resulted in savings of $6 million for SGI and our customers.
Here are SGI’s picks for the Top 5 Insurance Frauds from 2020:
Back and forth
A customer advised SGI she lent her son (we’ll call him “Roy”*) her vehicle, and that it was meant to be driven by a female friend “Pam.” The vehicle ended up crashing into a large, well-marked, construction zone hole.
Police attended the scene, and Pam initially admitted to driving, which was confirmed by others in the vehicle (including Roy). Once faced with taking a breath test by the police, Pam attempted to state she hadn’t been the one driving. She blew just under the legal limit.
Pam later provided SGI a statement that she was the operator at the time of the collision but could provide little details of how the collision occurred. When interviewed by SIU, she again recanted the version that she was driving and advised that Roy was the operator.
Evidence suggested Pam had been pressured to take the blame for the collision. She provided text messages, photographs, money transfers and video evidence to support her new version and was encouraged to go to police and tell the truth. Police continued the investigation, and were able to determine that Roy was in fact the operator. He was charged criminally for making a false statement and driving while suspended.
SGI is also taking steps to recover $7,600 paid out for this claim.
Cliffhanger
“Jessica” reported to SGI that she left her vehicle on the side of a gravel road because the engine light came on and she didn’t want to drive it. She had plans to come back and get it the next day. It was then stolen. Jessica said that she only had one key that was still with her and she had lost the other one a long time ago.
However, in the lead up to all of this:
- Jessica changed the policy coverage on the vehicle from “storage” to “drive” shortly before the day it was reported stolen.
- Jessica had taken her vehicle to the shop for a mechanical issue, and refused to pay the invoice, leading to her vehicle being locked in the shop’s compound until it was released by court order (bill still pending).
- Jessica then took the vehicle from the shop to a dealership who advised it had major issues that needed to be addressed.
Police verified that the vehicle was driven to an 80-foot cliff (yes, in in the prairies) and pushed off the edge. There was no evidence that the vehicle had been broken into, and no keys were found at the scene. The claim was denied. Approximate savings: $25,500
Gaming the system
"Sheldon” submitted a stolen auto claim, alleging it had been stolen while he was away with the only key, and the vehicle was subsequently involved in a hit and run.
Sheldon made a lot of claims during the investigation:
- He claimed to have bought the vehicle from a person who was not the registered owner by trading a video game console and about $2,000 – which was well below the market value of the SUV in question.
- He said it was stolen to SGI, but did not report it to the police.
- When police called Sheldon about the hit and run, he told them he was home with his wife – but upon further investigation, stated that he lived alone and didn’t have a wife.
- He claimed the vehicle was parked in front of his house when he left to go out of town, however investigation revealed that the SUV had already been in the collision the morning of the alleged theft.
The person believed to be driving during the hit and run (Sheldon’s friend “Leonard”) had a suspended license. The vehicle was claimed to be stolen to avoid getting Leonard involved. Sheldon wanted to withdraw his claim until finding out he would be held responsible for third party damages and required to repay SGI. Savings = $5,800.
The old switcheroo
"Fiona” reported her vehicle stolen from her residence and stated she still had the only key for it.
Fiona said she had found the vehicle online and met the seller for a test drive. Fiona said she paid the seller in cash and began to put permits on the vehicle through phone and online transactions only.
SIU investigated, and found the missing vehicle had actually been exported out of the country years prior, and the key Fiona claimed belonged to it was actually from an entirely different vehicle.
Due to her unbelievable story, she was denied coverage for a savings of approximately $47,000.
All in the family
A tractor was heavily damaged in a fire. Although “Kyle” had an Agro Pak, the tractor had not been included in the policy.
Kyle’s parents contacted the brokerage, where they learned of a 30-day acquisition clause that extends coverage to any newly acquired machinery. After learning of this clause, the parents later let SGI know that Kyle had recently purchased the tractor from them, providing a hand-written bill of sale conveniently dated within the 30-day clause. They also stated a down payment had been made of some livestock, with the remainder to be paid at a later time, so no actual cash had traded hands.
The circumstances of this inter-familial sale were highly suspicious, and when Kyle considered his options with SIU, he decided to withdraw his claim.
Total savings: $15,000.
* * *
If you’re making an insurance claim, just be honest. There are fewer reasons than you would think for not being covered.
Anyone with information about potential insurance fraud is encouraged to contact SGI's Special Investigation Unit at siu@sgi.sk.ca or 1-800-667-8015, ext. 6887. To report anonymously, call Saskatchewan Crime Stoppers at 1-800-222-8477.
*All names changed, except Penny McCune’s.
