Hard Vs. Soft Fraud
Insurance fraud can be classified as either hard fraud or soft fraud.
Hard fraud occurs when someone deliberately plans or invents a loss, such as a collision, auto theft, or fire that is covered by their insurance policy in order to receive payment for damages. Criminal rings are sometimes involved in hard fraud schemes that can steal millions of dollars.
Soft fraud, which is far more common than hard fraud, is sometimes also referred to as opportunistic fraud. This type of fraud consists of policyholders exaggerating otherwise legitimate claims. For example, when involved in a collision an insured person might claim more damage than was really done to his or her car. Soft fraud can also occur when, while obtaining a new insurance policy, an individual misreports previous or existing conditions in order to obtain a lower premium on their insurance policy.
Read more about this topic: Insurance Fraud
Famous quotes containing the words hard, soft and/or fraud:
“In really hard times the rules of the game are altered. The inchoate mass begins to stir. It becomes potent, and when it strikes,... it strikes with incredible emphasis. Those are the rare occasions when a national will emerges from the scattered, specialized, or indifferent blocs of voters who ordinarily elect the politicians. Those are for good or evil the great occasions in a nation’s history.”
—Walter Lippmann (1889–1974)
“To rest, the cushion and soft dean invite,
Who never mentions hell to ears polite.”
—Alexander Pope (1688–1744)
“There exists in a great part of the Northern people a gloomy diffidence in the moral character of the government. On the broaching of this question, as general expression of despondency, of disbelief that any good will accrue from a remonstrance on an act of fraud and robbery, appeared in those men to whom we naturally turn for aid and counsel. Will the American government steal? Will it lie? Will it kill?—We ask triumphantly.”
—Ralph Waldo Emerson (1803–1882)