When to Consider an SIU Referral?

Insurance fraud has a fiscal consequence on Americans with up to $7,000 worth of premium increases in a 10-year period, but it also has emotionally devastating effects on victims. People are left injured, penniless, and devastated at the hands of insurance crooks who are looking for an easy way to make big money.

Studies indicate that SIU’s recover $10 for every dollar spent in an investigation.

All insurance companies are required to have an in-house SIU team or outsource it to a claims management company. But how do you determine if your case needs to be sent over to SIU?

Here are some signs experienced insurance adjusters look out for:

• A claimant who’s calm and unflustered when submitting a large claim
• A claimant who submits handwritten receipts for repairs on a covered item
• A claimant who adds or increases homeowners or auto insurance coverage shortly before submitting a claim
• A fire-damage claim for a home or auto where the fire started immediately after a family argument, or shortly after family members left the home/car
• A medical claim submitted by a seasonal employee whose job is ending.

Here is a small excerpt from the Coalition Against Insurance Fraud , “The VA eventually declared Cook legally blind. During the time he was considered blind and 100% disabled, but how the heck did he renew his driver’s license several times over the years, legally owned and also registered 30 vehicles.” This is a story featured on their Insurance Fraud Hall of Shame 2022, where they post all people convicted of insurance fraud in 2022. The stories range from life policy payouts to dentists harming people’s teeth to put in crowns. One thing all of these stories have in common –  the fraud investigators and SIU teams that incarcerated them.

Investigation techniques

Newly appointed SIU team members shall have demonstrated through the hiring process a combination of education and professional experience that properly equips them for the duties at hand. Evidence of such may include some or all of the following: completion of relevant post-secondary educational courses and/or programs; licensure as a Certified Public Accountant and/or professional designation of Certified Fraud Examiner; law enforcement training and/or certification; investigative and/or audit experience with local, state or federal law enforcement or governmental agencies; experience investigating fraud and other white collar criminal activities; or other relevant education or experience that establish to SIU fitness for the duties.

Let’s take a closer look at the deceptive practices seen in insurance claims:

• Fake or Inflated Damages: Filing insurance claims for damages that are non-existent, preexisting, or exaggerated.
• Vehicle Theft and Arson: Filing a false police report and insurance claim for a stolen vehicle.If the vehicle is deliberately abandoned or set on fire in a secluded area by the owner, hoping to cash in on the insurance policy.
• Insurance After the Fact: A driver is involved in an accident and does not have existing automobile insurance coverage. The driver then purchases a policy and subsequently files a false claim by lying about the date of the accident. 
• Body Shop Fraud: Dishonest body shop operators bill the insurance company for Original Equipment Manufacturer (OEM) parts when after-market or salvaged parts were used, or body filler was used to conceal the damage. Fraud can also involve excessive billing for automobile body parts or repair work that was not done.

The Benefit of an SIU Expert:

Do you know what’s one of the most important personality traits of SIU investigators? According to this study, low extraversion and high emotional stability.

• Interview training where they hone in on oral, written, and recorded interview skills.
• Recognizing deception or odd behavior during interviews
• Constructing proper document verification, including medical, billing irregularities, and pharmaceutical abnormalities.
• Understanding of bad faith, the investigative process, and investigators’ powers under the policy.
• Experience working with defense attorneys, and insurance companies therefore familiar with the court proceedings and the deposition process.

The Investigation Process

Imagine this: a customer rolls the dice on an insurance claim, blaming a pesky puddle for their truck’s engine quitting. Crosses your desk and seems like a regular claim no reason to not pay it out. However, because of the high price tag of the repair you decide to send this over to the Special Investigations Unit (SIU). They uncovered that the truck’s odometer was rolled back by the claimant, shaving off a cool 150,000 kilometers. Turns out, the customer was attempting to inflate the truck’s value to get a higher payoff. Once caught red-handed, they withdrew their claim faster than you can say “insurance fraud.” According to Insurance Business Magazine, the SIU department saved them $7,000 in this example.

Fraudulent burglaries and thefts represent the most popular form of insurance fraud. Here is the process of a typical SIU team:

Collecting Data –

Data gathered and analyzed as part of the case should be accurately interpreted, logically presented, and maintained in the case file. They use vehicle location data, request records from LEAs (law enforcement agencies), analyze raw data and access and aggregate third-party data crucial to solving the case.

Collecting Evidence –

Evidence collected should be sufficient to support the case findings, logically related to those findings, and consistent with the facts of the case. Procedures for the disposal or return of evidence should be well established. Lacking the proper evidence collection methods your groundbreaking evidence may be inadmissible. SIU teams are trained to determine the reliability and originality of evidence through metadata, surveillance, forensics teams, etc.

Interviews –

Particular attention should be given to obtaining the interviewee’s observation and knowledge of incidents and actions, and/or statements of others that have involvement with the case. Information, identification, and likely location of relevant documents, and/or documents or records provided should be properly documented and used during the interviewing process. Having a claimant commit perjury is a sure way to close a case if you have evidence that proves the opposite.

Records Management –

Case records should be stored in a manner that allows for effective retrieval, reference, and analysis, while also ensuring the protection of all sensitive data. For example, no evidence that contains moisture should ever be packaged in plastic or paper containers for more than two hours. Microorganisms that grow due to the moisture in this enclosed space destroy or alter evidence: accountability and tracking purposes.

So do you need to refer your case to SIU?

The investigative process entails collecting and analyzing data, gathering evidence, conducting interviews, and ultimately saving insurance companies thousands of dollars by preventing fraudulent payouts. By partnering with a knowledgeable SIU team that understands your needs, you can build a strong case and avoid paying a single unnecessary dollar. It’s partially required by state regulations but the bottom line is it’s a valuable risk and revenue precaution.

Interested in learning more about what Special Investigations Unit investigators can offer? Contact us today.