Author
Bowtie Team
Updated on
2025-06-19
Disclaimer: This article is translated with the assistance of AI.
What types of insurance investigations are there? How does the process work, and what strategies fight fraud like falsified medical records? Curious about a career as an investigator? Discover the required qualifications, skills, and salary potential. Bowtie breaks it down with real fraud case studies for your reference.
What is an Insurance Investigation?
The purpose of an insurance investigation is to confirm whether an insurance claim is reasonable and legal by collecting different evidence, conducting interviews, and reviewing records.
Insurance companies generally commission consulting firms to send professional insurance investigators to look into suspicious claims. This helps assess their legality, weed out false or exaggerated ones, and avoid paying out to fraudulent parties, all to maintain the interests of the underwriting insurance company and all policyholders .
Since annual claims expenditures affect the entire risk pool’s premiums, failing to investigate and reduce fraudulent claims behavior would only drive up premiums significantly. Responsible insurance companies should step in to manage claims properly, keeping everyone’s interests in mind.
Common Types of Insurance Investigations
- Medical Insurance Fraud Claims: Medical personnel or patients may engage in false or exaggerated insurance claims, and both parties may even collude to defraud. According to Cornell Law School , in the US, the proportion of health care insurance fraud claims can reach up to 10% of the total compensation amount.
- Personal Injury Claims: Investigations target claims of personal injury made by companies or individuals, such as when someone attributes pre-existing injuries or long-term wear and tear to a slip on a wet restaurant floor, then seeks compensation from the restaurant and its insurer.
- Work Injury Claims: These investigate whether an employee was injured on the job, if the injury was work-related, and whether the cause and process match the claimant’s description, ensuring the claim’s legitimacy and reasonableness.
- Property Loss and Theft Claims: These investigate various property damages from events like fires, floods, traffic accidents, theft, or robberies, verifying that the cause and process align with the claimant’s account.
Insurance Investigation Process
Collecting and Reviewing Documents
Gather and review official records related to medical issues, injuries, or property losses. For medical and accident insurance investigations, medical records, hospital/institution/doctor notes are crucial; for property loss claims, claimants may need to provide receipts from when they purchased the items, photos proving ownership, and more; for traffic accident claims, police records, statements from parties involved, accident reports, and vehicle inspection reports are required.
Taking Statements and Interviews
Interview patients/victims, witnesses, and perpetrators (if possible), having them describe the events of illness, injury, treatment, property loss, or traffic accidents. Investigators will request written statements and, if feasible, record them via audio.
On-Site Investigation and Surveillance
Conduct on-site visits to accident scenes or gather evidence abroad if needed. Investigators will take photos of the site, cross-reference them with the claimant’s injury/property loss details, statements, and official records. When necessary, they may surveil the subject, such as checking if a claimed injured party is moving freely or even engaging in vigorous activities.
Social Media Investigation
For instance, review the claimant’s social media to uncover signs of financial hardship, dissatisfaction with a company or job, or activities that don’t match their claimed injuries, using this as supporting evidence.
Report Writing and Testifying
After completing the investigation, investigators must write a report. Depending on the claim’s progression, they might be summoned to court to testify.
How to Become an Insurance Investigator?
Generally speaking, those hoping to become an insurance investigator should possess the following conditions:
- Communication skills
- Organizational skills
- Written communication skills
- Investigative skills
- Critical thinking skills
- Decision-making skills
- Negotiation and persuasion skills
- Knowledge of insurance regulations
According to industry insiders, the educational requirements for local insurance investigators aren’t too high—generally, just a secondary school education (Form 5) is needed. However, some job ads specify that applicants should have a sub-degree or associate degree. Companies hiring investigators often prioritize personality traits over formal education, such as being meticulous, curious, detail-oriented, and skilled at organizing data. In fact, many retired law enforcement officers end up in this role because they have a solid grasp of relevant regulations.
In the US, though, applying for an insurance investigator position might require a bachelor’s degree, or even one in criminal justice or a related field. Depending on the type of insurance investigation, employers could ask for specific specialized degrees, like in accounting.
What is the Salary of an Insurance Investigator?
According to some local online job advertisements, insurance investigators hired by notary firms or investigation consulting companies have monthly salaries ranging from HK$15,000 to HK$22,000 . Meanwhile, based on data from Career Guide Website Indeed , the average annual salary for insurance investigators across the US is about US$45,400.
Insurance Fraud Cases in Hong Kong
Case One
Doctor A was a private practitioner. One day, his friend Mr. B, who worked as an insurance agent, suggested a “money-making” scheme: Using Mr. B’s company’s personal accident insurance plan, they would recruit workers Mr. B knew, like construction workers, to buy the accident insurance. Then, when the workers got minor injuries, they could claim compensation from the insurance company. Doctor A would fill out the claim forms, exaggerating the injuries to boost the payout, and the compensation would be split among them.
Result: Doctor A, Mr. B, and the involved construction workers conspired to defraud the insurance company using false claim applications for personal gain, violating conspiracy to defraud charges. Additionally, Doctor A breached Section 26.3 of the Code of Professional Conduct for Registered Medical Practitioners in Hong Kong by issuing inaccurate claim documents.
Case Two
Insurance agent Mr. C recruited several people to buy accident insurance policies from multiple companies he represented. These policyholders agreed to his plan and deliberately injured themselves to file false claims.
Knowing that the insurance companies he dealt with didn’t have a shared system to check claim records and spot suspicious cases, Mr. C worked with a registered Western doctor and a registered Chinese medicine practitioner to issue multiple exaggerated medical certificates for the involved patients, deceiving the insurance companies into paying out.
Result: Mr. C used these exaggerated medical certificates as proof for claim applications to fraudulently obtain insurance payouts from his own companies. This involved submitting documents with false information that benefited him at the expense of his principals, breaching Section 9(3) of the Prevention of Bribery Ordinance . He and his accomplices, including the doctors and others, also committed multiple offenses, such as conspiracy to defraud .
Falsifying Medical Records: Could It Be Fraud?
Insurance companies’ claims departments not only approve claims through claim documents and medical reports but also, when necessary, hire professional insurance investigators to investigate suspicious cases. This ensures that all compensations are legal and comply with policy provisions, maintaining fairness for all policyholders.
For medical, accident, and critical illness insurance, whether or not in collusion with healthcare professionals, falsifying or intentionally concealing medical history when applying for a policy, or fabricating or exaggerating conditions when claiming, could constitute fraud . Remember, any fraudulent acts are criminal offenses, so don’t risk it.
Always Declare Your Medical History Accurately!
When purchasing insurance, it’s crucial to declare your medical history and records accurately and completely, so you can truly enjoy the peace of mind that insurance provides. Concealing or omitting any medical history could lead to your policy being voided or claims being denied. Remember, insurance companies have the right to investigate and may review your medical records. If you’re unsure whether certain health conditions need to be declared, we recommend consulting with the insurance company.
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