Insurance fraud drains more than $50 billion from insurers each year and costs the average U.S. family between $400 and $700 in the form of increased premiums, according to the FBI.
According to Amica Scam definition, Insurance fraud is any act committed with the intent to obtain a fraudulent outcome from an insurance process. The most common methods include:
- Staged car accidents
- Fraudulent car thefts
- Inflated losses
- Fraudulent injury claims
- Application fraud
People who commit insurance fraud could be individuals or organized groups.
Below Are Top 11 Most Bizarre Life Insurance Fraud That Shook The Insurance World
1 “Iron” Mike Malloy: The Guy Who Wouldn’t Die
One of the most weird cases of life insurance fraud goes all the way back to 1932 when speakeasy-owner Tony Marino hatched a plan centered around an old drunk named Michael Malloy. The conspirators, later dubbed the “Murder Trust” by the press, managed to take out three different life insurance policies on Malloy, which they planned to cash in after hurrying along his untimely demise.
But it turned out Mike was made of sterner stuff than they realized. Over the next few months, the conspirators tried poisoning Malloy countless times, freezing him to death, and even running him over with a car, all to no avail. It took a full seven months for the men to finally usher Mike into the afterlife, only to have their scheme uncovered shortly after. They each ended up being rewarded for their efforts with a trip to Sing Sing’s electric chair.