Insurance coverage scams have sadly grow to be commonplace throughout the nation, leaving many People grappling with surprising losses. In 2021, the Federal Commerce Fee found that customers reported $5.8 billion in losses because of fraud—a 70% enhance in fraud-related losses in comparison with 2020.

Regardless of the nationwide attain of those scams, sure states are extra in danger than others. For a number of causes, Ohio has grow to be one of the crucial focused states within the nation.

On this article, we dive into the several types of insurance coverage scams Ohio residents must be cautious of, what to do if you happen to encounter fraudulent conduct, and the steps you’ll be able to take to guard your self and your private home.

Contractor Fraud: The Main Insurance coverage Rip-off in Ohio

Some of the frequent insurance coverage scams in the present day is contractor fraud, a phenomenon that takes many types however at all times ends with cost to a contractor for work they didn’t full accurately or in any respect. Within the final two years, a staggering $82 million was misplaced to contractor fraud, making it one among historical past’s only and harmful scams.

Ohio is a extra generally focused state for contractor fraud due largely to the extreme climate it withstands all year long and the variety of alternatives it creates for fraudulent contractors to reap the benefits of householders.

Did You Know: Ohio isn’t the one state the place extreme climate attracts fraudulent contractors. Following important climate occasions, analysis reveals a major spike in contractor fraud circumstances nationwide.

5 Key Warning Indicators of Contractor Fraud

Householders in Ohio ought to stay educated in regards to the warning indicators of contractor fraud to keep away from falling sufferer to those scams. We’ve listed some key warning indicators of scams beneath.

• The contractor gives a low beginning bid. Scammers are identified for providing low costs early on after which discovering further issues that enhance the general price after work has begun.
• They ask for a big or full down cost earlier than beginning work. In lots of circumstances, this tactic permits them to take your cash and go away with out starting work.
• They use high-pressure ways. Scammers typically provide particular offers or reductions if you happen to pay upfront or signal the day of to lock you into the work earlier than you’ve had an opportunity to analysis their firm and decide in the event that they’re respected.
• They appear overly thinking about your insurance coverage protection. Asking questions on earlier claims or your premium quantities normally signifies a contractor may need an ulterior motive.
• They use low cost or substandard supplies. If the standard of the supplies or work the contractor is doing on your private home isn’t as much as par, they might be attempting to finish the job as rapidly and cheaply as potential whereas nonetheless charging full value to your provider.

Did You Know: The roof is commonly probably the most weak of all of the areas of a constructing scammers can goal. This space is commonly costly to restore and exhausting to entry with out the right instruments, making it straightforward for scammers to lie about or trigger harm with out the proprietor discovering out.

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How one can Stop Contractor Fraud

There are steps you’ll be able to take as a home-owner to guard your self from falling prey to a house enchancment rip-off.

1. All the time keep knowledgeable. Observe industry-leading fraud prevention companions like Central Insurance coverage on social media for the newest updates on scamming developments and ideas for staying forward of fraudsters.
2. All the time get a written contract. Shield your self from fluctuating costs, unfinished or substandard work, and drawn-out deadlines by making a well-documented contract earlier than embarking on the work.
3. Get your insurance coverage provider concerned. Insurance coverage carriers like Central have the instruments and nationwide partnerships to correctly deep dive into any contractor’s historical past. From previous circumstances of fraud to contractor licenses and insurance coverage protection, your provider will help decide whether or not an organization is respected.

What do I do if I feel my contractor is scamming me?

Should you’ve by chance gotten in too deep with a contractor and are frightened they’re scamming you, your first step is to alert your insurance coverage provider. Trade-leading carriers like Central will have the ability to decide if the contractor has a previous historical past of dangerous conduct and can join with different carriers throughout states to establish any patterns of their method.

Study Extra: Who Is Most at Threat for Contractor Fraud?

Householders may also file a grievance with their state’s Division of Insurance coverage. These organizations typically group up with insurance coverage carriers like Central to research the contractor and decide if they’re fraudulent. 

Ohio Residents: You may file a fraud grievance on the Ohio Division of Insurance coverage web site. 

Different Widespread Insurance coverage Scams in Ohio

Though contractor fraud is probably the most important insurance coverage rip-off in Ohio in the present day, there are many others residents must be on the lookout for. 

Auto Insurance coverage Scams

Auto insurance coverage scams are available many styles and sizes. For instance, a driver may declare an accident occurred that didn’t obtain a payout for current harm to their automobile. Others may exaggerate accidents after an actual accident to pocket the insurance coverage cash allotted to their care. Should you’re a driver, be looking out for falsified or exaggerated claims in opposition to you, as these can contribute to bigger insurance coverage fraud scams and drive up your auto insurance coverage premiums.

Medical Fraud

Medical fraud can take many types. Whether or not it’s patient-, attorney-, or provider-led, these scams mostly contain attempting to realize a bigger payout from insurance coverage corporations for current and even falsified accidents or circumstances.

The most typical of those scams is medical fraud initiated by a medical supplier. In these circumstances, a physician may advocate intensive or pointless assessments and even procedures to drive up the price of the invoice. Sufferers ought to stay vigilant in opposition to these sorts of scams and phone their insurance coverage corporations or their state’s Division of Insurance coverage to report suspicious exercise. 

Study Extra: A Deep Dive Into Medical Fraud

Renter’s and Home-owner’s Insurance coverage Fraud

In these circumstances, householders or renters may submit claims for thefts or damages that didn’t happen. Whereas this may appear to be a victimless crime solely impacting an insurance coverage firm, the reality is falsified claims contribute to rising premiums throughout the state. 

Lean on Your Insurance coverage Provider for Safety

Insurance coverage is an funding designed to guard you when the worst occurs. At Central, we consider insurance coverage scams fall inside that class. That’s why we now have a group of designated fraud prevention specialists working tirelessly to guard our policyholders from fraudulent contractors, drivers, healthcare suppliers, and extra. 

With cutting-edge analytics techniques and partnerships with organizations starting from the Geospatial Insurance coverage Consortium to the Nationwide Insurance coverage Crime Bureau, we’re dedicated to defending our insureds’ well-being and peace of thoughts.