When a policyholder files a home insurance claim, they’re asking for their policy to cover some kind of damage or the loss. This could be due to theft, fire or many other such issues. One of the key things that the insurance company has to determine is if the claim is fair or if it is being inflated.
Keep in mind that intentionally inflating these claims can count as insurance fraud. However, that doesn’t stop people from trying it. They often act as if they’re at odds with the insurance company, trying to do whatever they can to get as much money as possible, rather than working with the company to make things right again.
For instance, imagine that there is a fire in someone’s home. They get it put out before it spreads to the entire house, but it destroys the kitchen. However, the homeowner had some old water damage in the dining room ceiling that was too costly to repair. They claim that the water damage came from the efforts to put out the fire when it was really there long before the fire.
Or, say that someone’s home is broken into and their television gets stolen. They know that they had an older 32-inch TV, but they claim to have had a brand new 4K TV that was 70 inches, which was worth three times as much. They’re not lying about the theft and they do need coverage, but they’re artificially inflating the costs to get more money than they deserve.
These are just two examples, but they show how easy and common it is for people is misreport their claims. Insurance companies need to make sure they know about the legal options they have when faced with these kinds of issues.