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What does an Insurance Fraud Investigator do?

By Ken Black
Updated Mar 02, 2024
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An insurance fraud investigator is an individual who works for an insurance company in order to determine if a claim is made under false pretenses. This is especially true of disability claims, where individuals may say their movement or quality of life is limited because of chronic pain. Due to the fact that chronic pain is often hard to prove medically, this can present a problem for insurance companies. Some also may investigate medical bills, but these are easier to verify.

In some cases, a fraud investigator will work for an insurance company on a full-time basis. The larger companies often have enough cases where they can support an individual, or even an entire department, in this capacity. The other alternative, of course, is to use the services of a private investigator, contracting for services only when needed. This is the way many investigators in private practice make their living.

After an insurance fraud investigator is given a case, he or she will usually start gathering some background information. The case file will include the subject's last known address and any other personal contact information available. The complaint filed will also be on hand so that the investigator can determine if the complaint is valid. For example, in a disability case, the person involved may claim they do not have the use of his or her legs.

After the initial review of the case file, the investigator will then usually turn to surveillance work in order to see if the claim is valid. While this may involve some highly technical equipment, such as remote surveillance video, most of the work is done using a standard still camera and video camera. Using the example of the man who claimed he could no longer use his legs, the investigator will look for evidence that this is not true. If he sees the man regularly using a wheelchair, he may conclude the claim is valid. If, however, he sees the man playing football with neighborhood kids, he will likely document the event with pictures and videos, and report his findings.

In most cases, the findings will be presented to an insurance lawyer or consumer fraud lawyer. At this point, the company will likely suspend any disability payments to the individual. Civil and even criminal charges could come as the result of the investigator's work. At a trial, he may be called on to testify as to what he actually witnessed during the insurance investigation, and to report on the accuracy of his equipment and recordings.

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Discussion Comments
By anon327648 — On Mar 29, 2013

I have a sister who pretended to be married to someone in the state of North Carolina to put him on her health insurance. Can she be charged with insurance fraud?

By disciples — On Oct 21, 2012

I remember hearing a statistic once that said basically that if all insurance fraud stopped the average person would pay something like $300 less per year. That is real money. Insurance fraud is not a victimless crime like some people have suggested.

By jonrss — On Oct 20, 2012
I used to work as a private investigator, and almost every one of the cases I was involved with was insurance fraud. People would say they couldn't work and then we would go track them down to see what they sent all their time doing.

You would not believe how blatant some people were about it. I remember one guy who said that his right arm was completely disabled. I got video of him in a public park playing a vigorous game of badminton with his right arm. There went his claim!

By sneakers41 — On Sep 04, 2010

Crispety and Cupcake15- I heard about that case too. The victim had over $100,000 in debt that was not his as Blue Cross received hospital bills for treatment in Seattle, when the victim never stepped foot in that state.

The case was solved after one year of the insurance fraud investigator having taken the case.

By Crispety — On Sep 04, 2010

Cupcake15- Wow. How long did it take them to solve the case?

By cupcake15 — On Sep 04, 2010

BrickBack- I think that the insurance fraud investigator career will be booming for many years to come. I think that the incidences of insurance fraud will only get worse which should provide more opportunities for anyone interested in the field.

There must be an enormous sense of accomplishment when you actually solve a fraud case. I recently heard about a 35 year old identity theft case in which a health insurance fraud investigator was able to solve.

The victim’s health insurance was the target of the investigation and another party used it fraudulently.

By BrickBack — On Sep 04, 2010

Comfyshoes- The average insurance fraud investigator salary is about $60,000 a year. The actual insurance fraud investigator job description requires someone who is detailed oriented and persistent.

The insurance fraud investigator reviews the cases and sets up the necessary surveillance which includes capturing video evidence.

The insurance fraud investigator may also take pictures of the subject with a camera in order to further solidify the case.

Most insurance companies prefer someone with a four year degree in finance. Also, previous police or detective work is a plus and maybe a requirement for some insurance companies.

Insurance companies will offer some insurance fraud investigator training, but it is often limited which is why they seek people with investigative experience.

By comfyshoes — On Sep 04, 2010

Anon36994- That is great that you conduct insurance fraud investigations. I wanted to add that there are a couple of non profit organizations dedicated to investigative services in the insurance field.

They are the Coalition Against Insurance Fraud, the National Associate of Insurance Commissioners, and the National Insurance Crime Bureau.

All of these organizations exist to support the field of private investigations in the insurance sector. Some of these organizations offer online forums where you can discuss the field with like minded people.

By anon36994 — On Jul 16, 2009

I'm a fraud insurance investigator and I'm working for a small insurance company since one year. With not great experience,I've tackled several cases (auto- insurance).I hope to have more tips from you to deal with the job more efficiently. Thank you

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