According to insurance sources, syndicates even go to the extent of “hiring” a homeless person and taking out an insurance policy in his or her name. After some time, the insurance company gets a claim saying the person has died in a hit-and-run accident.
Because of such practices, insurance companies are seeing a rise in fraudulent claims and they have begun to be more stringent in their checks.
A leading insurance company’s general counsel told FMT her company had noticed syndicates, disguised as employers, buying personal accident insurance for their “staff”.
“They will clean up a homeless person to look well, call an insurance agent and sign the poor man for insurance, claiming the man is a staff member.
“After about a year, the person is found dead in a hit-and-run accident. It is seldom through natural causes,” said the general counsel who did not want to be named. However, there is no proof of murder.
She admitted that in earlier years, insurance companies were unaware of this trick and paid the claims through the “employer”.
She said the companies realised something was amiss when the money was not channelled to the family, and the given addresses of families were hard to locate.
“This scam created a lot of millionaire homeless people without them knowing it. After finding out that something was not right, we came up with well-defined ways to stop this.”
She added that insurance agents were constantly working with the police on this matter and had made headway in stopping such cases.
Sometimes, she said, the syndicates would hire women to act as the claimant’s wife.
“These women are not your ordinary women. They are trained in what to say and do not divulge information about the syndicate even under pressure.”
But, she said, companies were aware of this and many women had been found out.
Cutting a thumb, gouging an eyeball
Gruesome methods that have surfaced include claimants chopping off a thumb or digging out an eyeball to make claims.
An insurance company’s head of investigations, who has been in the industry for 20 years, said certain insurance policies allowed people to insure their body parts.
“They normally claim that they lost their body part in an accident or while at work. But we have experts to separate genuine cases from the lies,” he said.
He told of a frustrated taxi driver who made claims after slicing off a small piece of his thumb. The company suspected he was not telling the truth.
He said the taxi driver then walked into a clinic and tried to intimidate the doctor into issuing a medical letter, saying it had been an accident. “When the doctor refused, he twisted his own thumb till it snapped.”
In another case, a man made a claim because one of his eyeballs had come out in an accident. The insurance company did a check and found out he had actually gouged out his eyeball to make the claim. It refused to pay.
The investigator added that sometimes people, who were riddled with heavy debts, committed suicide. This is normally the case during the World Cup, when some people lay bets, and an economic downturn.
He said during the 2018 World Cup, several bookies lost money and committed suicide. The trend was also seen in the 1997 and 2008 economic downturns.
“It is very sad. They will leave a suicide note, contact number of their family, and the insurance company documents,” he said.
He said his company had not received any cases of parents killing their children for money, and spouse killings were normally crimes of passion.
But they have had to deal with cases where either a boyfriend or a girlfriend was murdered and it was made to look like an accident.
He said arson cases had dropped significantly as the police and the Chemistry Department used high-tech gadgets to determine fraudulent cases.
They also have to deal with fraudulent surgery claims where men or women want to sharpen their noses or have an ideal pair of lips under the pretext of going for medical surgery.
He added that some doctors were known to be accomplices in this.
Due to this, he said, they now carried out data analytics to look at the trend, the clinics involved and the type of claims to curb such practices.
There was once a bizarre case of an expert who could copy the handwriting of any doctor to help people make claims. When the man was caught, his room was found to be filled with medical books listing the different injuries and the impacts, he said.