As I have written in a recent post, there are many types of scams and frauds and the list is growing every year. Among those many fraud types, insurance fraud can also be broken down into subcategories. Think of it as folders on a computer.
Fraud would be the parent folder and it would look something like this:
— Identity theft
— Payment fraud
— Mobile Payment Fraud
— Online Payment Fraud
— Insurance fraud
— Hard fraud
— Soft fraud
Not the most accurate illustration, but you should get the gist of it.
What exactly is insurance fraud? To put it bluntly, insurance fraud is when someone makes a false claim intended for financial gain. Some people could give fake information in order to gain money. The insurers can counteract this by denying benefits rightly entitled to their consumers.
Ian Leaf HFC is a department that focuses on studying the methods used by cons and busting their schemes. From what the departments gathered in their a report, all “subcategories” of fraud can be rated as hard or soft fraud.
Hard Fraud, as you may would suspect, is more of a threat and taken very seriously. Hard fraud is the active, deliberate planning or acting on a planned fraud.
Soft fraud is fraud that is a bit more difficult to catch. Often times, the people who commit this level of fraud have no intention of frauding. It occurs when someone begins telling fibs on insurance claims so they can acquire benefits that they wouldn’t have otherwise from their employer.