Slip-and-fall claims, that is, the form of insurance fraud where individuals create their own staged dangerous situation so that they can fake falling down and hurting themselves in order to receive monetary compensation, are on the rise, and small businesses seem to be a main target.
Businesses do need the coverage in order to protect themselves financially, as an innocent individual could slip and fall, sustaining a serious injury that requires expensive medical treatment. Unfortunately, though, criminals are taking advantage of the fact that these scenarios are quite simple to fake and are providing them with a simple – if unethical – way to obtain money.
The National Insurance Crime Bureau (NCIB) has recently discovered a number of different attempts to try to use slip-and-fall litigation threats in order to try to extort money from the owners of small businesses. Scam artists use this method to try to receive cash payments from these innocent shop owners.
The strategy usually works when a scam artists fakes an injury in a store and then tells its owner that medical care will be required. After some time has passed, the scam artists returns to the business to tell the owner how much the medical expenses cost, and that he will be suing for that amount. At some point in the conversation, the owner is offered the opportunity to pay a certain amount in cash to have the whole mess go away. Unfortunately, when the shopkeepers pay up, it only encourages more extortion.
The majority of these cases are never reported to the police, which makes the problem difficult to measure. The NICB reviewed slip-and-fall insurance fraud claims that were indeed made and determined that they rose by 12 percent from 2010 to 2011. California saw the largest number of cases (667), followed by New York (280) and Texas (245).