How is insurance fraud defined?

Insurance fraud is defined as an act intended to deceive an insurer for financial gain. This encompasses a variety of illicit activities where an individual or entity misrepresents the truth in order to secure payments or benefits to which they would not be entitled under the terms of the insurance contract.

Fraudulent activities can include exaggerating losses, submitting false claims, or providing misleading information during the application process. The key aspect of this definition is the intentional deceit aimed at benefiting financially at the insurer's expense.

In contrast to this, legitimate claims for damages represent valid requests for payment based on actual losses, misunderstandings of policy terms refer to genuine confusion without any intent to deceive, and errors in filing a claim typically involve unintentional mistakes rather than an intent to manipulate the insurance system. Each of these alternatives lacks the crucial element of intent associated with fraud.