CAIA Fraud Detection and Prevention in Auto Claims 2 — Questions and Answers
Question 1: Which of the following best describes a 'swoop and squat' staged accident scheme?
- A driver intentionally backs into a parked car
- One vehicle cuts off another causing it to brake suddenly while a rear vehicle collides (Correct answer)
- Two drivers agree to exchange insurance information without an actual crash
- A driver files a claim for a pre-existing dent
Correct answer: One vehicle cuts off another causing it to brake suddenly while a rear vehicle collides
In a swoop and squat, a 'squatter' vehicle cuts in front of a target car and brakes suddenly, causing the target to rear-end them while a second vehicle blocks escape.
Question 2: Which physical evidence inconsistency most strongly suggests a fraudulent rear-end collision claim?
- Paint transfer on the bumper
- Damage patterns inconsistent with the described impact speed (Correct answer)
- A cracked tail light on the claimant's vehicle
- The claim was reported the same day as the accident
Correct answer: Damage patterns inconsistent with the described impact speed
When the physical damage pattern does not match the physics of the described collision, it indicates the damage may have occurred differently than claimed.
Question 3: What is the role of the National Insurance Crime Bureau (NICB) in auto fraud investigations?
- It regulates insurance rates in all 50 states
- It provides a federal database and investigative resources to combat insurance fraud (Correct answer)
- It certifies auto adjusters and appraisers
- It sets minimum coverage requirements for auto policies
Correct answer: It provides a federal database and investigative resources to combat insurance fraud
The NICB is a non-profit organization that partners with insurers and law enforcement to investigate and prevent insurance fraud and vehicle theft.
Question 4: An adjuster reviews social media and finds the claimant posting photos of strenuous physical activity days after claiming a disabling back injury. This evidence is best used to:
- Automatically deny the bodily injury claim
- Support referral to the SIU and potential fraud investigation (Correct answer)
- Immediately cancel the claimant's policy
- Share publicly to warn other adjusters
Correct answer: Support referral to the SIU and potential fraud investigation
Social media evidence of activity inconsistent with claimed injuries supports an SIU referral and is documented in the claim file as a material inconsistency.
Question 5: Which of the following is considered 'hard fraud' in auto insurance?
- Failing to report a secondary driver
- Inflating the cost of legitimate repairs
- Reporting a stolen vehicle that was actually sold (Correct answer)
- Choosing a higher coverage limit than needed
Correct answer: Reporting a stolen vehicle that was actually sold
Hard fraud involves deliberately fabricating an entirely false event, such as reporting a vehicle as stolen when it was actually sold or hidden.
Question 6: State insurance fraud statutes in the U.S. typically classify insurance fraud as:
- A civil infraction only
- A criminal offense that may be a felony depending on the dollar amount (Correct answer)
- An administrative violation handled only by the Department of Insurance
- A misdemeanor with no imprisonment
Correct answer: A criminal offense that may be a felony depending on the dollar amount
Most states classify insurance fraud as a criminal offense, and when the fraudulent amount exceeds a threshold, it is elevated to a felony charge.
CAIA Fraud Detection and Prevention in Auto Claims 2
Which of the following best describes a 'swoop and squat' staged accident scheme?