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03-21-2008, 05:25 AM
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Tips to Avoid Insurance Scams
Although insurance crime is not a violent crime, it is advisable for the consumers to follow certain common sense steps to reduce frauds and minimize their effects.
• Be an informed consumer: Insurance premiums are a significant expense for most of us. The premiums are usually based on individual claims history and the degree of risk involved. Here it is important for the customers to have a knowledge that the greater the risk the higher the premium. • Comparison shop: In order to make comparison shopping easier, the insurance department publishes consumer guides for auto, homeowners, long-term care and HMO/health insurance that provide sample premiums for insurers that offer this coverage. • Know your agent or broker: Most of the times consumers are victimized by unscrupulous agents or brokers. It is only after a claim is filed that one discovers that they are without coverage for their assets. In such a case the consumer becomes solely responsible for any damage that may be done. Legitimate agents or brokers must carry proof of licensure, which one should always check. • Where’s the proof? Always avoid making payments in cash. Instead try to pay by cheque or money order made out directly to the company or the agency and not to the individual agent or broker. In addition, always request a receipt. • Where’s the policy? You are entitled to receive a copy of any type of insurance policy complete with endorsements and declarations specifically outlining your coverage and its limitations within a reasonable period after your purchase. You must check for any satisfactory explanation for the delay. • Check the bills for services you have not received: Carefully check your “Explanation of benefits” statement for any charge for services that you have not received. Contact your insurer immediately if you feel there are discrepancies. • Too much small print: A common way in which insurers can trick you is by putting the important issues of you insurance in the smallest of print possible. This is to ensure that you overlook any detail that is earning them extra money or leaving you without coverage. 
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