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This fraud technique involves a loss at a time when an individual has no  or inadequate insurance. Following the loss, the individual applies for  insurance or increases the limits of existing coverage. After a period  of time (usually several days or weeks), a fraudulent claim is submitted  for a loss reported to have happened after the new policy came into  effect. Failure of the insurer, or its agent, to see the property  (especially if the insurer has included the items on its schedules)  before issuance of a policy is an invitation to this type of fraud.  There is an unwritten exclusion in every insurance policy that requires  that every covered loss must be fortuitous, that is, be the result of a  contingent or unknown event. Attempting to post-date an auto loss is  often difficult and if there is a police report, impossible.Insurance  policies typically come into effect at 12:01 a.m., standard time on the  day the policy is purchased. If a person has an auto accident, fire or  theft at 10:00 a.m. he may go to an insurance agent, purchase a policy  that goes into effect at 12:01 a.m. that day, and make claim on the new  policy.Because the insurance fraud perpetrator will report that the loss  occurred the day after the policy date, this type of scheme usually  fails. When there is evidence that the insured knew about the incident  before the policy was acquired or that there exists evidence when it  actually happened, like a police or fire report, this type of fraud will  fail.   Paper Property   This sort of fraud involves property that never existed or was never  owned by the insured. It can be the most difficult type of staged loss  to defeat. Paper property can appear in a staged loss or in a legitimate  claim, where paper property is used to inflate the claim amount. In the  presentation of the claim, the insured produces a receipt (original or  duplicate) or an appraisal. The document is either fraudulent (examples  include the use of computers or even white-out paint and a photocopier  to change the name of the owner) or represent the value of an item owned  by another individual.For example, an insured who purchased jewelry at a  department store on a credit card, took the jewelry to an appraiser,  returned the jewelry for full credit and then reported it stolen. The  jewelry (no longer in her possession) was then insured by means of the  appraisal and a loss was reported shortly thereafter. The receipt  presented to the insurer was legitimate and if the receipt was not  verified with the vendor the fact that it was returned and is still in  inventory at the vendor will never be discovered.In one of my cases my  investigator went to the vendor to verify the sales receipt. It was  verified and then the vendor asked the investigator: \\u201cwould you like to  see it?\\u201d He then pulled the item out of a showcase and provided the  investigator with the receipt showing he refunded the insured the  purchase price when it was returned.   Health Insurance Fraud    The nation\\u2019s bill for health care fraud is enormous \\xbe as large as $300  billion or more every year. Fraud takes place at many points in the  health care system, in hospitals, nursing homes, and diagnostic  facilities, by doctors, attorneys, health care providers, durable  equipment providers, and patients.One large area prone to fraud is the  Medicare system. This system processes more than 800 million claims a  year with 70 different contractors handling the claims that come from  hundreds of thousands of doctors, laboratories, and other health  practitioners and facilities.    \\xa9 2021 \\u2013 Barry Zalma