She did it! | Zalma on insurance

This is a fictionalized True Crime Story about insurance fraud from an expert who explains why insurance fraud is a “Heads I Win, Tails You Lose” situation for insurance companies. The story, and many others are my book “Insurance Fraud Costs Everyone” will help the public understand how insurance fraud in America costs everyone who buys insurance thousands of dollars every year and why insurance fraud is safer and more profitable for the perpetrators than any other crime.

Watch the full video at https://rumble.com/v2bu2e6-being-a-bad-neighbor-is-not-a-crime.html and at https://youtu.be/7zm-lqdJMbI

Being a good neighbor is hard work. Sometimes it is impossible. Marsha was not a good neighbor. She would “borrow” things from her neighbors and never return them. Most of her small kitchen appliances came because of such loans. Marsha had an extensive collection of CDs and LPs, none of which she bought. Marsha would invite herself to lunch, but never invite her neighbors to her house for lunch.

She would play her stereo at maximum volume at all hours of the day. Everyone who lived within six houses of Marsha lost sleep over her actions. None of her neighbors liked Marsha.

Marsha kept a bull terrier named “Jaws” that she did not allow in her house. However, Jaws would escape the backyard every week. Neighboring cats, rabbits and small dogs disappeared with some regularity.

The whole neighborhood hated Marsha and Jaws. If Marsha ever decided to move, the neighbors would throw a party that they wouldn’t invite her to. Everyone in the neighborhood was afraid of Marsha and Jaws. They tolerated her because they didn’t know how to get her out of the neighborhood.

One summer evening when Marsha was at a concert, burglars broke into her house. Jaws, knowing the burglars in the house, barked furiously but could do nothing since Marsha tied him up in the backyard. The neighbors ignored Jaw’s barking because they were afraid to offend Marsha by complaining about the noise. Marsha lost her jewelry, two televisions, two VCRs, her stereo and her microwave.

During police interrogations about the break-in, the neighbors could only report that they heard the dog barking but did not see anything. Most smiled when they learned of the break-in and whispered their joy at Marsha’s loss.

Two days later, Marsha’s adjuster came and parked in front of her house. On the adjuster’s car was a sticker identifying the company for which she worked. The adjuster spent an hour interviewing Marsha and deemed the report a routine burglary. The adjuster asked Marsha to fill out a form listing all personal property stolen, its purchase date, purchase price, replacement cost and its actual cash value. When the adjuster received the list, she expected to go through the list, arrive at a true cash value for the items, and negotiate a quick settlement with Marsha.

Marsha’s neighbors had other plans. Harry and Louise, who lived next door, looked up the address of the insurance company in their phone book. They then sat at an old Underwood manual typewriter and wrote a letter to the insurance company that read:

“We are neighbors with Marsha, the person you are insuring. We know that she has reported a burglary at her house to the police and is claiming losses due to that burglary.

“The claim is a fraud. Marsha’s house was not burglarized. She did not have the items she claims stolen.

“If you need more information please call us at 555-5555.”

They then signed their names. Three other neighbors did the same.

The insurance company, faced with the allegations, had no choice but to report Marsha’s claim to the Fraud Division of the State of California Department of Insurance as a suspected fraudulent claim; entrust investigation to its Special Investigation Unit (SIU) and conduct a thorough investigation of the alleged facts.

The SIU investigator interviewed Harry and Louise and all the other neighbors. They convinced the investigator that Marsha was not a credible person. The investigator thought Marsha was a despicable person. He knew she was the one the three neighbors were talking to considered a fraud.

The insurance company hired an attorney to examine Marsha under oath and confront her about the allegations of fraud. The Fraud Division, faced with the compelling evidence from the neighbors’ statements, launched its own investigation and presented the case to the prosecutor for prosecution.

Marsha, completely innocent and the victim of a crime, was left speechless. Her insurance company would not pay her claim and insisted on interrogating her endlessly in front of a court reporter. She could not understand the reasons for the interrogation. She explained to the attorney for the insurance company why her claim was valid.

Marsha confronted the insurance company’s attorney with her sworn testimony that her claim was legitimate. He also had access to the reasonable and unsworn testimony of the three neighbors. There appeared to be compelling evidence that the claim was a fraud and equally compelling evidence that it was a valid burglary claim.

The lawyer, the SIU investigator, and a court reporter, went back to Harry and Louise’s home. They asked Harry and Louise to give evidence under oath to establish the fraud they had reported. Harry and Louise agreed to the sworn testimony and were ready to continue with their false accusations until the insurance lawyer explained to them the penalties for perjury. Harry and Louise decided that while Marsha deserved punishment for her lack of neighborliness, it wasn’t worth jail time to have her punished. They told the truth. They explained to the attorney why they had told the SIU investigator that they believed Marsha had committed fraud.

On the advice of counsel, the insurance company settled Marsha’s claim immediately. The Fraud Unit was notified of the false report. Harry and Louise were not punished. No one told Marsha why it was taking so long to resolve her claim.

If the insurance company and its lawyers took Harry and Louise’s statement at face value and denied Marsha’s claim, the insurer would have faced a lawsuit from Marsha for falsely accusing her of the fraud.

The law in California, and several other states, now requires insurers to have dedicated fraud investigation units. The law requires the specially trained investigators to investigate claims of fraud to protect the insurer and the public from the crime. However, SIU investigators must remember that they are also claimants whose duty it is to pay all legitimate claims and to carefully investigate the basis for any denials.

It was this thorough investigation, including the sworn examination of Marsha and the sworn testimony of the neighbors that saved Marsha from possible prosecution and the insurer from a bad faith lawsuit.

Every professional tort adjuster understands that not all apparent fraud is fraud, not all innocent claims are innocent, and it is the duty of every claimant and SIU investigator to carefully investigate each claim with the intent of finding that an alleged loss is appropriate and compensable. .

If fraud is proven through a thorough investigation, the claim should be dismissed and the person making the claim should face the wrath of the local or US Attorney.

(c) 2023 Barry Zalma & ClaimSchool, Inc.

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Barry Zalma, Esq., CFE, now limits his practice to serving as an insurance consultant specializing in insurance coverage, insurance claims management, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims attorney and more than 54 years in the insurance industry. He can be reached at http://www.zalma.com and zalma@zalma.com

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