True Crime of Insurance Fraud Video Number 55
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\\nI\\u2019m Going into the Insurance Business
\\nMost insurance companies are formed by major corporations with considerable assets. They are capitalized with serious money needed by the Insurer to cover losses until profits are made. The company is staffed with insurance professionals who believe in the concept of spreading risk. The insurers, whether new or old, provide a definite service to the public.
\\nBetty Bruja wanted to start her own insurance company. She had been an insurance broker for ten years. In those ten years she had trained herself with books and training courses from the Insurance Risk Management Institute, the Society of Certified Property and Casualty Underwriters, the Insurance Institute and the Insurance Claims Library. By devoted and lengthy study Betty obtained the designation CPCU in the minimum time allowed by the Society of CPCU. She studied underwriting and claims handling. No person, Betty thought, was as knowledgeable about insurance as she. No insurance company operated efficiently. Massive profits could be made if she only was put in control.
\\nFor ten years Betty Bruja toiled in the trenches of the insurance industry obtaining a small income off 5% to 15% commissions. She was frustrated. She knew she could make money if only there was capital to fund a new insurance company. Ms. Bruja hired an independent adjusting company to investigate and adjust claims. Since none of the policies had any wording, she denied coverage on most claims by creating a policy exclusion to fit the claim. During the first year of her program of fraud she paid no claims and collected $500,000 in premium.
\\nRobin Sleuth was the owner of a small traveling carnival. He had purchased a policy from Betty and renewed it with PPC. He was pleased with the premium. He needed a certificate of insurance in the name of the City of Ojai because his carnival was setting up on an empty lot owned by the City. Betty was slow in issuing the form. Robin looked at his insurance file and noticed he never received policy wording from Betty. He faxed her a letter demanding a complete copy of his policy and a certificate. Betty, recognizing a trouble maker, sent Robin a notice advising, since they could not agree, that his policy was canceled flat and she returned the premium he had paid. Robin was furious. He was forced to cancel his appearance in Ojai and scramble to get insurance through another agent. The premium was twice that he paid to Betty.
\\nPPC immediately hired a private investigator and counsel experienced in fraud investigation. They flew to Robin Sleuth\\u2019s home city and interviewed him. They obtained copies of all written evidence and obtained Robin\\u2019s promise to maintain the originals in a secure place that were not to be destroyed. The lawyer and investigator then flew directly to the city where Betty did business and arrived at her new paneled offices. They demanded to see Betty.
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