These days, it seems that any accident warrants a lawsuit. But, because many of us our taught to sue rather than take responsibility for our own actions, fraudulent claims are at an all time high. Insurance fraud happens all the time and it happens in every state. That means that individuals of all races, incomes and age brackets are being taken advantage of because insurance fraud costs everyone close to $80 billion a year.

Insurance fraud has existed ever since the insurance industry was established. Types of insurance fraud are diver and ranges from severe to slight exaggeration to calculatingly staging accidents or damage. Insurance premiums are higher as a direct result of these types of crimes and continue to skyrocket.

According to Alfred Manes, a former Professor of Insurance and Economic Research at Indiana University, the single motive in insurance fraud is financial gain. Insurance companies are predisposed to fraud because of the propensity to sue and because false insurance claims can easily be made to look like ordinary claims.

There are two classifications of insurance fraud. These are hard fraud and soft fraud. Hard fraud generally occurs when someone deliberately plans or invents a loss of some kind, such as a collision, auto theft, fire or personal injury. Soft fraud, which is much more common, is considered to be an opportunistic fraud. This type of fraud means that certain policyholders will exaggerate legitimate claims. For example, if someone is involved in a collision he or she might claim more damage than was really done to his or her car if insured.

Healthcare insurance, auto insurance and property insurance are the most taken advantage of. National and local governments, especially in the last half of the 20th century, have recognized insurance fraud as a serious crime. Law enforcement officials have made significant efforts to punish and prevent this type of practice. Insurance Fraud is specifically classified as a crime in 48 out of 50 states. There are 19 states that require mandatory insurer fraud plans and 41 states have fraud bureaus. Section 1347 of Title 18 of the United States Code states that anyone attempting to or carries out a fraudulent claim in an attempt to take advantage of a healthcare benefit program will be fined under or imprisoned for 10 years. In some cases, both may occur. If the fraudulent claim results in bodily injury, the individual may be imprisoned for up to 20 years. If the fraudulent claim results in death, the individual may be imprisoned for life.

For example, when Timothy Nicholls set his Colorado Springs home on fire to steal insurance money so he could escape a mounting debt, three children were perished. He owned a motorcycle gang some money and his business was struggling.. He is now serving life in prison.

Insurance Fraud is a serious criminal offense and should not be taken lightly. As with any other crime, you will be prosecuted and held responsible for your actions in a court of law.