If you have been insured or you are a person that has collected an insurance policy then you are not expected to make extra profit from the insurance policy which you have taken if any loss occurs. If either by commission or omission such happens then such a person has already cheated on other insureds whom might have also gotten the same insurance policy with you. This is why this article today talks about is it illegal to profit from an insurance claim.
We do not think anyone should make profit from an insurance claim and this is because insurance involves pool of money that is being contributed by a large number of people and where as any member of such pool gets to suffer a loss, gets to be reinstated in a normal position he was before the loss and this is why no one is expected to make extra money from an insurance claim.
The essence of insurance is making sure you are brought back to the level that you were before you suffered a loss and not an avenue for you to go higher than the level that you were before. Just like how most experts put it, insurance isn’t a Santa Claus affair but it is there to provide you with favorable options if an event of loss happens so that those who are insured already can go about with their normal life like nothing actually happened.
Is It Illegal To Profit From An Insurance Claim
Trying to make extra profit from an insurance claim is an act that can be seen as you trying to defraud an insurance company and this could eventually lead to having your claims denied or rejected. One question most people ask is how does this get to happen and what can be done to prevent ones insurer from thinking that he wants to make some extra profit off an insurance claim. The first thing you should know that an item should never be insured twice.
What this means for example is having two insurance for one vehicle, building or machinery at the same time but with two different insurance companies. This is very illegal and if you do this then you have ended up paying premiums in two different places. What you are entitled to is just one claim and if these two insurance companies know about this claim then the claim would be shared based on the risk that it carries.
Insuring a property at the same time but with two different companies puts you at a spot where you might lose and another example of such is if you there is a case of loss that might probably involve a vehicle and the insured goes ahead to repair it and come back with a claim then he just shot himself in the leg for not informing the insurance company of a loss of property but still went ahead to carry on with repairs.
At this point, it is okay for the insurer to totally disagree with whatever amount you claim for repairs and the insurer would also decide on what amount you would or should be paid and this amount might not be satisfactory to you. Do not put yourself in the seat because it can get frustrating because what you needed to have done if there was an accident that actually led to a loss was calling your insurer for an assessment on the spot.
This would also prompt the insurer to take records of the accident and also begin processes on how you can get compensated. Taking an insurance policy is actually a very serious business which would require steps to be taken when it comes to claims processing and if there is a loss, the first thing that you must do is go ahead and notify the insurer immediately so they can come and carry out an assessment so they can determine the extent of loss.
Failing to do this is where the first disagreement usually pops up from and if you are done with this stage then you can finally move to filing out the claims form so documentation can be done and the claims process can move on or proceed from there. Sincerity by every party is needed during an insurance claims process and this practice is regarded to as an act of good faith.