BROADCASTS.com

Published: Oct. 29, 2020, 1:31 p.m.

b'

Soft Fraud When Perpetrated Against Insurers

\\n

https://zalma.com/blog

\\n

For reasons known only to governmental entities some insist on categorizing fraud into both \\u201chard\\u201d and \\u201csoft\\u201d fraud. By so doing the governmental entities that so categorize fraud make one type of fraud less heinous and less criminal than the other. Fraud, whether categorized \\u201csoft\\u201d or \\u201chard,\\u201d are criminal and if a person is tried and convicted of fraud both can be sent to jail for the same amount of time.

\\n

\\n

The types of insurance fraud some call \\u201csoft fraud\\u201d are found in every type of claim presented to an insurer.

\\n

\\n

Soft fraud, which is sometimes called opportunity fraud, occurs when a policyholder or claimant exaggerates a legitimate claim.... According to the Insurance Research Council, soft fraud \\u201cIs far more frequent than hard fraud\\u2026 Because of the frequency of soft fraud, it adds more to overall claims cost than hard fraud does.\\u201d

\\n

\\n

Soft fraud occurs when a policyholder exaggerates an otherwise legitimate claim or when an individual applies for an insurance policy and lies about certain conditions or circumstances to lower the policy\\u2019s premium.

\\n

\\n

The reality is that Soft Fraud is a criminal violation and a breach of a material condition of the policy. It contributes to increased insurance costs.  As a result of increased insurance costs, millions of Americans cannot afford sufficient insurance coverage. One cannot commit an innocent or partial fraud any more than one can be partially dead. Once fraud is committed the contract of insurance is violated and voidable and the crime has been committed.

\\n

\\n

Soft fraud, in contrast, usually involves legitimate losses that are exaggerated by the policyholder. For example, if a person is in a car accident and files a claim with her auto insurance company but overstates the severity of the damage to her car. The insured did not fabricate the accident or the underlying claim, but nevertheless committed soft fraud by not being completely truthful with the insurance company.

\\n

\\n

In New Jersey, regardless of whether or not the fraudulent act is soft or hard, insurance fraud is a third-degree felony under New Jersey law. And if a person is charged with five or more acts of fraud, the charge can be elevated to a second-degree felony. This means that even if convicted of the lesser, third-degree charge, the person perpetrating fraud may be facing up to 18 months in jail and a $10,000 fine.

\\n\\n--- \\n\\nSupport this podcast: https://podcasters.spotify.com/pod/show/barry-zalma/support'