CCP SIU Referral & Fraud Indicators 3 — Questions and Answers
Question 1: A homeowner files a claim for fire damage and the fire investigator determines the fire's origin was incendiary. Which factor would MOST strengthen a fraud referral?
- The homeowner recently remodeled the kitchen
- The homeowner had significantly increased the policy limits 60 days before the fire (Correct answer)
- Neighbors reported smelling smoke
- The fire occurred during the day
Correct answer: The homeowner had significantly increased the policy limits 60 days before the fire
Substantially increasing coverage shortly before a suspicious loss is a key fraud indicator, especially when combined with an incendiary origin finding.
Question 2: Which type of fraud involves a legitimate accident but exaggerated injury claims or inflated repair estimates?
- Hard fraud
- Soft fraud (Correct answer)
- Provider fraud
- Arson fraud
Correct answer: Soft fraud
Soft fraud involves opportunistic exaggeration of a real claim, such as inflating damages or overstating injuries after an actual accident.
Question 3: An injured worker's social media posts show them playing sports the week after claiming total disability. This is primarily an indicator of:
- A legitimate recovery discrepancy
- Malingering or workers' compensation fraud (Correct answer)
- A coverage dispute
- A subrogation opportunity
Correct answer: Malingering or workers' compensation fraud
Social media activity inconsistent with claimed disability is a strong indicator of malingering or workers' compensation fraud warranting SIU referral.
Question 4: Under the ISO ClaimSearch system, what primary function does the database serve in fraud detection?
- It verifies policy premiums against market rates
- It identifies patterns of prior claims across multiple insurers (Correct answer)
- It scores medical providers for billing compliance
- It confirms state licensing of auto repair shops
Correct answer: It identifies patterns of prior claims across multiple insurers
ISO ClaimSearch cross-references claims data across insurers to reveal suspicious claim histories or patterns that a single insurer would not see alone.
Question 5: A claimant reports a jewelry theft but cannot provide any purchase receipts, photos, or appraisals for the claimed items. This lack of documentation is:
- Automatically proof of fraud
- A fraud indicator that may warrant further investigation (Correct answer)
- Not relevant because homeowners policies cover undocumented items
- Sufficient to immediately close the claim
Correct answer: A fraud indicator that may warrant further investigation
Inability to substantiate high-value items is a fraud indicator that warrants additional investigation but alone does not prove fraud.
Question 6: What is the term for a scheme in which medical providers bill for services at a higher complexity level than was actually performed?
- Phantom billing
- Upcoding (Correct answer)
- Unbundling
- Duplicate billing
Correct answer: Upcoding
Upcoding is fraudulent billing that uses higher-level CPT codes than the services rendered actually warrant to receive greater reimbursement.
Question 7: Which individual is typically NOT part of the core SIU team that handles a formal fraud investigation?
- Licensed private investigator
- Forensic accountant
- Defense attorney retained by the insurer (Correct answer)
- State insurance fraud bureau analyst
Correct answer: Defense attorney retained by the insurer
Defense attorneys are engaged for litigation, not as core SIU team members; SIU teams typically include investigators, analysts, and law enforcement liaisons.
CCP SIU Referral & Fraud Indicators 3
A homeowner files a claim for fire damage and the fire investigator determines the fire's origin was incendiary.
Which factor would MOST strengthen a fraud referral?