Catching Insurance Frauds
Who would ever tell their Junior High School Guidance Counselor that they wanted to be an insurance claims examiner when they grew up? I certainly never said that was what I wanted to be…but there I was…as a young man in a 5-year training program, employed by a very large insurance company. I was fortunate that my employer was a mutual insurance company and not a stock company. You see, a mutual company is owned by the policyholders and consequently, any profits made go back to those policyholders and the company is answerable to the insured owners. Conversely, stock companies are owned by stockholders and are motivated toward quarterly profits for their shareholders. Needless to say, stock companies take greater risks than mutual companies.
I had marvelous mentors. One man, in particular, was 40 years my senior and yet he exhibited patience with me, shared a lifetime of knowledge (both business and personal) and introduced me into the detailed world of a claims examiner. I was excited, overwhelmed and intrigued by my new duties that I had accidentally fallen into and ended up loving. Yes, you read that correctly…I loved what I did for a living. I excelled at my job, first as a Disability Claims Examiner, then a Disability Income Specialist, I moved on to a Claims Manager and eventually, I became a Benefits Administrator. I handled disability income, suicide, homicide and accidental death claims, along with preparing compromise settlements with attorneys and claimants. I prepared lawsuit referrals for our legal department attorneys and answered detailed State Insurance Department inquiries. I had a natural nose for this business which would become a game of wits. Not to be lost in my quest to be the best in my field, was my personal mission statement to make sure all legitimate claims were paid and to deny those that did not fall under the terms of a contract or were clearly cases of fraud.
Most life insurance policies have a “Suicide Clause” that generally excludes payment of death benefits proceeds if the insured commits suicide within the first 2 years, from the date of issue to date of death. The premise behind a suicide clause is that most people don’t purchase life insurance with the intent of committing suicide 2 years and 1 day after a policy is issued. DOUBLE INDEMNITY is the doubling of a policy’s face value in the event death has been the direct result of accidental means. Naturally, before a company pays a double indemnity, they will do an exhaustive investigation to make sure an insured’s death was in fact, due to accidental means.
A MEAT MALLET, MERCEDES BENZ, AND A REAL CLIFFHANGER
The police determined that after the doctor assaulted his wife with a meat mallet, he drove from the scene of the crime when his Mercedes-Benz went off the side of the road and landed upright on a boulder. The report went on to state that upon impact, the doctor’s neck got caught in the seat belt as he was hurled through the passenger window and found hanging on the outside of his car. My mentor had a rather large magnifying glass when he called me over to his desk. “Dennis, what do you see in this picture?” he asked. Showing my naivete, I quickly replied that I saw a body, hanging out of a car window, dangling over a cliff. Calmly, the elder examiner told me to look at the deceased’s neck, using the magnifying glass. That’s when he pointed out the seat belt was actually wrapped around the deceased’s neck twice. After numerous tests, it was determined to be physically impossible for a body to accidentally have a seat belt go around the neck twice, while being flung from the driver's seat, across the passenger's side of the vehicle and through the passenger's window. Subsequently, the original police report was overturned and the cause of death was changed from accident to suicide and only the face amount of life insurance was paid.
COMMIT A CRIME AND YOU WON’T COLLECT A DIME
In its simplest form, Disability Income Insurance will pay a stipulated benefit to a policyholder who becomes disabled due to sickness or accident within the terms and conditions of their policy.
The claimant seemed to have a valid claim to receive disability income benefits after losing three fingers in a boating accident explosion. However, things aren’t always what they appear to be. Doctor and hospital records proved there was trauma with the loss of fingers and yes, the accident did occur during a boat explosion. What the insured had failed to report were his criminal activities. For you see, in checking newspaper clippings, interviewing people and inquiring with other insurance companies, our claimant was linked to a history of sinking, setting fires and blowing up boats along the Mississippi River so that boat owners could collect insurance on their luxury crafts. Apparently, our guy, obviously no rocket scientist, was nothing more than a hired thug. He not only had his disability income declined, but he didn’t need any money anyway because he was sent up the river to the “Big House.”
BACK ON THE ROAD TO CAMPING
Things aren't always what they appear to be as evidenced by an insured complaining he had injured his back. I wanted to place him under surveillance even though the investigator contacted me after a one on one interview and explained how the claimant literally had tears running down his cheeks while attempting to lift his coffee cup. I was still skeptical when I instructed him to place a surveillance at both ends of the insured's residential street. Within a couple of hours, my telephone rang again and mysteriously the investigator was laughing. It appears my hunch was correct as pointed out by video evidence of the claimant walking out of his front door and up to the back of his camper, where he proceeded to use both hands attempting to jockey it into place on the back of his pickup truck.This guy could have won an Academy Award for having crocodile tears one moment and then acting like Joe Atlas the next moment.
HELLO…IS THIS THE PARTY TO WHOM I’M SPEAKING
He was a bar and restaurant owner in California who had collected disability benefits for several months. I knew he was working and yet I couldn’t prove it. Every time I called the insured or sent an investigator to his establishment he claimed he had just stopped in to pick up his mail. The three hour time difference was proving to be an obstacle. This was back in the days of outrageously high long distance phone charges. My intuition got the best of me and I asked my boss if I could make a long distance call from home and charge it to the company and he agreed. When my alarm went off at 3:00 on a Saturday morning, I tiptoed downstairs, closed the family room door and called Bill (not his real name) at the bar and restaurant. An employee answered the phone with the background noise of music and a loud boisterous crowd. I yelled into the phone, “Hi is Bill tending bar tonight?” “Yes, he is,” was the answer. “May I speak with him,” I asked? “We’re really busy tonight. Can I tell Bill who is calling” the worker inquired? “Well, I’m an old friend from back east and I really want to surprise him,” I replied. The ensuing conversation went something like this: “Bill you’ve got a call? Who is it because I’m swamped? I don’t know. It’s some guy who says he’s a friend from back east and wants to talk to you. Okay, give me the phone. Hey Bill…working your tail off tonight aren’t you? Oh, you know it. We’re buried. Excuse me, but who is this? I’m so glad to hear you’re back to work because this is Dennis Page with Mutual of XYZ and on Monday I’ll send you your final check through Friday. You got me. That will be fine. Thank you.” I felt like George Peppard in the “A-Team when at the end of the show he would proclaim, “I love it when a plan comes together.”
EVERY WORD OUT OF YOUR MOUTH MAKES ME SICK
He was a German tennis professional who claimed he was so disabled he couldn’t even hold a tennis racket. The wonders of video proved otherwise when we had taped evidence of the insured giving private tennis lessons. When I terminated benefits I received a phone call and in broken English, I was told in no uncertain terms the following: “Mr. Page, every word out of your mouth makes me sick.”
$20.00 IN CAB FARE – NOW GET OUT OF MY OFFICE
Carl (not his real name) was a large and imposing man who had received monthly disability payments for several months due to neck and back pain. It was time for me to send him for an independent medical examination by a Board Certified Orthopedic Surgeon. The doctor’s testing indicated the patient had a limited range of motion with his neck, arms, and back, exhibiting immense pain during his 30-minute office visit. The report I received was worded something like this:
Upon completion, I instructed the patient he could now get dressed, at which point he leaned forward to slip on his undershirt, pulled it over his head and raised both arms in the air without visible signs of distress or range of motion. He then proceeded to sit down, bent over and put on both socks without difficulty. The patient was able to balance on one leg while he slipped on his pants and did so with ease. He again sat down, slipped his feet into his shoes, bent over and tied both shoes with fine finger dexterity and no outward signs of discomfort. Finally, the patient moved his right arm in the direction of his back, bending it at the elbow and placed his arm in his jacket. The patient repeated the same range of motion in his left arm, again without outward signs of pain or restricted movement.
After I had denied Carl’s claim, I received a call from the emotionally upset orthopedic surgeon. His voice was quivering. Apparently, Carl arrived at the doctor’s office, challenging and intimidating both the physician and his staff until the doctor gave him $20.00 in cab fare just so he would leave. I can’t even begin to tell you all of the expletive words Carl threw my way, but with any business, you learn to take the bad with the good.
I remember when we started receiving our first autoimmune deficiency (AIDS) cases in 1982. There wasn’t a whole lot of data about the AIDS virus back then. I was shocked when I opened the police envelope and saw pictures of a naked man hanging in a doorway, with pornographic photos strewn across the floor. In those days, that type of death was referred to as sexual asphyxiation. Eventually, the term was upgraded to “auto-erotica.” The first decomposed body of a suicide I saw was that of a man who had asphyxiated himself in his car and his body wasn’t discovered for months. The only image that stuck in my mind from all of the photographs was burnt chicken. Needless to say, when I got home from work that same evening my wife had prepared to perfection, two Rock Cornish game hens. I didn’t eat dinner that night.
Frauds and liars have been around since the beginning of time. Thankfully the world is full of more honest people than dishonest ones. I was proud of the job I did. I was a salaried employee who took work home most nights and weekends. The diversity of my cases kept me interested and enthralled and all these years later I still miss what I did to earn a living. There are not too many people who can make that statement.
WRITTEN BY: DENNIS L. PAGE