Affordable Insurance Fraud Defence Lawyers in Ottawa

Anyone accused of insurance fraud or another white-collar crime in Ontario can face both immediate and longer-term consequences.

Depending on the nature of the alleged fraud and how the case proceeds, the accusations can impact your employment, finances, and even your freedom.

If you’re being investigated for insurance fraud, it can be a very testing time. Speak with one of our skilled insurance fraud lawyers at Affordable Defence before engaging with an investigator to receive support for your predicament.

If you have already been charged with insurance fraud, we can help you understand more about the charges against you, build a defence, and prevent the worst consequences for your future.

Insurance fraud is considered a white-collar crime. It consists of an act committed with the intent of obtaining payments from an insurer fraudulently—a relatively common scenario across Canada with so many types of insurance and insurers available today.

Some of the most common types of insurers claiming insurance fraud in Ontario include providers of home insurance, car insurance, life insurance, and medical insurance.

Most commonly in Ontario, an insurance company claims insurance fraud from a customer who inflates a legitimate claim or fabricates a claim to receive a payment.

Inflating a claim is usually termed “opportunistic insurance fraud”. Typical examples of this include:

• Claiming compensation for vehicle damage that existed before an accident
• Misrepresenting the condition of property
• Faking or exaggerating the severity of injuries in a medical claim
• Claiming for services unrelated to the insurance issue at hand

“Pre-mediated insurance fraud” is when someone purposely creates the conditions to claim insurance compensation, such as:

• Staging an accident
• Dumping property, such as a vehicle, and claiming for loss
• Starting a fire on one’s property
• Claiming for an event that never happened

Insurance fraud can also occur when customers of insurance companies fail to declare key information or provide false information, such as not reporting a pre-existing medical condition or providing a false address, etc.

Yet another type of insurance fraud turns customers of the insurance company into the victims rather than the perpetrators of the fraud. For instance, scammers may use one’s personal information, sell fake insurance policies or cancel them without the customer’s knowledge (charging premiums but depriving the victim of insurance coverage when it’s needed).

Most insurance fraud defence is based on defending an individual accused of defrauding an insurance company.

Insurance companies have many employees who are trained to detect the signs of fraud. Agents are meticulous in checking all details of claims and looking out for red flags, such as:

• Curious questions to insurance agents before claiming
• Pressure to settle immediately rather than wait for a higher payout
• Raising policy limits suspiciously before claiming losses
• Refusal to answer questions or provide extra documentation
• Presenting a story that seems “rehearsed”

However, it’s also important for customers to be suspicious of certain types of behavior by so-called insurance company representatives as they can be defrauded by scams. Avoid committing to anything that seems too good to be true or out of place, such as:

• Being asked to sign a blank accident benefit or other documents
• Being offered insurance policies at much lower rates than the standard market rate
• Being subjected to aggressive sales tactics

Being presented with suspicious contact information

You can prevent potential accusations of insurance fraud by understanding all reporting obligations when you sign up for a policy and when making a claim. Read the policy, including the small print.

Understanding the signs of potential insurance fraud outlined above and being careful with the information you share can also help you avoid becoming a victim of an insurance fraud scam.

What are the penalties for insurance fraud in Ontario?

There are no penalties specifically designed for insurance fraud in Ontario but fraud is a criminal offence under the Criminal Code.

The criminal penalties for white-collar crimes are harsh and depend on the amount of money involved in the act and the past criminal record of the perpetrator:

• Fraud or theft under $5,000: two years maximum prison term
• Theft over $5,000:10 years maximum prison sentence
• Fraud over $5,000: 14 years maximum prison sentence

Fraud is different from theft in that involves an element of deceit. It may be charged as an indictable or summary offence. A minimum punishment of two years in prison applies if the total value of the fraud exceeds one million dollars and the defendant is indicted.

Civil suits may also be filed against those accused of insurance fraud. These can seek compensation for costs or damages incurred by the insurer.

One other possible unforeseen consequence of being found guilty of insurance fraud is that insurance companies will refuse to provide coverage. This can be particularly serious for individuals who require professional liability insurance, for instance.

The Insurance Bureau of Canada (IBC) estimates that insurance fraud amounts to more than $1 billion a year.

False or exaggerated claims increase the costs for insurance companies and these costs are passed on to the customers in the shape of increased premiums.

According to the IBC, the most common types of insurance fraud are:

• Staged collision: a driver stages an accident with another driver, who is claimed to be at fault
• Inflated tow, store, and dent: unscrupulous auto repair shops and towing companies inflate bills to insurers
• Blank form scams: medical facilities request that patients sign blank accident benefit forms or bill the insurers for services that are not delivered
• Artificial reduction of risk profile: policyholders provide false age, address or vehicle information

If you have been accused of or charged with insurance fraud or any other white-collar crime in the Ottawa area, contact an experienced criminal lawyer at Affordable Defence for a free case evaluation.