11/13/2013 5:30 PM ET|
How social media ruin insurance claims
Lots of people can't wait to document their every move on Facebook, Twitter and other social media these days. When it comes to auto insurance, you should think twice before hitting 'send.'
A woman in Florida told her auto insurer that a hit-and-run driver had hit her car. She filed a claim for the damages. Then she went on Facebook and posted on her page how her daughter had caused the automobile accident.
Before the insurer paid her claim, its investigators searched social media and discovered the lie. She was later convicted of filing a fraudulent claim.
Such scenarios are happening more frequently these days.
Property and casualty insurers are increasingly using social media channels to investigate whether their customers' claims are genuine, according to a recent report by Timetric, a provider of online data, analysis and advisory services headquartered in London. Timetric's 2013 study found that fraud investigators use social media to investigate auto, fire and burglary claims the most.
"Mining social media for clues is one of the fastest-growing areas of insurance-fraud investigation," says James Quiggle of the Coalition Against Insurance Fraud in a report published last year.
Posts don't have to be obvious
Carlos Pallordet, a senior economist and spokesperson for Timetric, says people are posting on their Facebook page or tweeting things that could be used against them in a claims investigation. "Some are more direct and some are more indirect," he says.
Examples of indirect posts that could make claims investigators suspicious include photos or comments about the drivers' love of speed or recklessness, their dislike of using seatbelts, or their bragging about alterations they made to their cars that were forbidden by their policies or undeclared, says Pallordet.
Some don't care
Frank Scafidi, spokesperson for the National Insurance Crime Bureau based in Des Plaines, Ill., says you would think that if car owners were committing auto insurance fraud they wouldn't boast to the world about it on the Internet. Or Tweet it. But they do, and investigators are taking advantage of customers' brazenness when looking into claims.
"If people are dumb enough that they post things online that come back to bite them, we'll take it," Scafidi says. "When it comes to human and dumb, we continue to define the bottom."
Scafidi says that today social media has become "another tool" that most claims investigators use to do their jobs well. Part of it, Scafidi says, is that the computer makes it easy. Unlike when he worked for the FBI for 20 years, retiring in 2004, today investigators don't have to get in their cars and drive all over the place, hoping to spot someone with an "injury" carrying a ladder and cleaning out gutters. They simply sit at their desks to find all kinds of information on claimants and their accidents.
Auto claims investigators not only use Facebook and Twitter but also LinkedIn and Google to see what they can find about their policyholders, Pallordet says. Any Internet or social media site is fair game. "Facebook remains the biggest draw among social networking websites, though Twitter is increasingly used by insurance companies given its real-time status update option," he says.
Even sites or YouTube videos that you "like" or "dislike" can give investigators clues to your personality and insight to how honest you are about your claims, Pallordet says. "Like" skydiving or bungee jumping? It could suggest you're a risk-taker. Use Foursquare to let people know you're at a bar or nightclub and it suggests you drink.
What others say may count
And it's not just a matter of what you post, but it's also what others post about you. Claims investigators can find plenty of things on the Internet and social media from your friends and coworkers that could prove useful, Pallordet says. "It could be what people say about you on eBay -- if they had a bad experience buying from you -- that gives the investigators an idea of who you are," he says. "There are lots of things you can find on the Web just by searching someone's name and not all that you find is necessarily posted by that person."
Pallordet says investigators not only look at your social profile but also who your friends are for potential information that could be of use to them.
Proving value of posts another thing
How do fraud investigators know they have the right policyholder when looking at Tweets or Facebook or other posts?
They don't necessarily, Scafidi says. There is no way that an insurance company can know for sure that it is reviewing information about the right person. But they likely can connect the dots with not much trouble, he says.
Finding a post or a Tweet about a claimant that may be detrimental to their case is one thing, making a court-proof case out of it is another. "You still have connect all of it and it's a high bar to reach over," Scafidi says.
According to Timetric, lawmakers in the U.S. are working to make laws governing the use of social media and privacy more stringent, which could make it more difficult for social media "finds" to hold up in court.
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But wait! Before the insurance company in Florida could have even thought to pay a claim, it would had gone to court if there was an accident to see who was at fault. Florida has a no fault insurance law. In order for the insurance company to not paid a claim on this woman, they had to bring her to court. Now would it be better to pay the claim of a few thousand dollars or just pay for court and might have to pay after all.
So here is the deal, why wasn't there a police report done on the accident to start with? Most insurance companies will not pay a claim until they get a police report. I think that was a red flag right there.
My son had an accident when he was a senior in high school. The vehicle was still running and my son was not hurt. I did not turn in the accident period nor was there a traffic report made out on it.
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