CFS Insurance Fraud Investigation 2 — Questions and Answers
Question 1: An insured files a claim for a vehicle stolen from a mall parking lot, but surveillance footage shows the vehicle leaving with the insured driving. This is BEST classified as:
- Soft fraud
- Hard fraud (Correct answer)
- Premium fraud
- Phantom fraud
Correct answer: Hard fraud
Hard fraud involves deliberately staging or fabricating a loss, such as a false stolen vehicle report.
Question 2: Which red flag is MOST associated with a staged slip-and-fall claim at a retail store?
- Claimant has no prior injury history
- Incident occurs near closing time with few witnesses (Correct answer)
- Claimant reports the incident immediately
- Medical treatment begins within 24 hours
Correct answer: Incident occurs near closing time with few witnesses
Staged slip-and-fall incidents often occur when witness presence is minimal, such as near closing time.
Question 3: In workers' compensation fraud, a 'double-dipping' scheme refers to:
- Claiming benefits from two separate employers simultaneously (Correct answer)
- Inflating medical bills for a single injury
- Misclassifying employees to reduce premiums
- Filing claims under a deceased employee's name
Correct answer: Claiming benefits from two separate employers simultaneously
Double-dipping occurs when a claimant collects workers' compensation benefits while also working for another employer.
Question 4: Which investigative technique is MOST effective for detecting workers' compensation claimants who are secretly working while collecting disability benefits?
- Medical record review
- Social media analysis (Correct answer)
- Recorded statement
- ISO ClaimSearch query
Correct answer: Social media analysis
Social media often reveals claimants engaging in physical activities or employment inconsistent with their claimed disability.
Question 5: A property insurer discovers that a policyholder increased dwelling coverage significantly three months before filing a total-loss fire claim. This pattern PRIMARILY suggests:
- Innocent over-insurance
- Pre-planned arson fraud (Correct answer)
- Underwriting error
- Reinsurance fraud
Correct answer: Pre-planned arson fraud
Rapidly increasing coverage shortly before a major loss is a classic red flag for pre-planned arson or intentional destruction.
Question 6: Which organization maintains the ISO ClaimSearch database used by insurers to detect prior claims?
- NICB
- Verisk Analytics (Correct answer)
- NAIC
- FBI
Correct answer: Verisk Analytics
ISO ClaimSearch is a product of Verisk Analytics, providing insurers access to a national claims history database.
Question 7: When investigating a suspicious homeowner's claim, an SIU investigator interviews neighbors and discovers the insured moved out weeks before the reported burglary. This is MOST relevant to establishing:
- Moral hazard
- Motive and opportunity for fraud (Correct answer)
- Subrogation rights
- Proximate cause
Correct answer: Motive and opportunity for fraud
Evidence that the insured vacated the property before the reported loss helps establish both motive (financial distress) and opportunity for the fraud.
CFS Insurance Fraud Investigation 2
An insured files a claim for a vehicle stolen from a mall parking lot, but surveillance footage shows the vehicle leaving with the insured driving.
This is BEST classified as: