The last side of the fraud triangle refers to the Rationalization of the reason why the fraudster believes that insurance fraud is justified. Some of these frequent justifications may include:
01. “Everybody does it.”
Small-scale fraud is such a common phenomenon in the insurance industry that anyone would think it is easy to carry out.
Insurers are often seen as companies to whom a few dollars are no big deal and can be easily recovered. It is precisely this reasoning that encourages people to commit more fraud.
02. “I have no other choice.”
If a person feels that they have a money or liquidity problem, this may cause them to be in a desperate situation. From this, the person will not think twice before committing fraud, as it may be the only option to get some money.
03. “I have not been treated as I expected.”
A person who feels that his or her insurance company has not treated him or her as he or she deserved may use this argument to commit fraud.
As 100seguro points out in one of its articles, people “allow” ourselves to do what is not right, often convinced that it is not theft but an act of justice.
- Company codes of ethics, transparency codes, zero tolerance for fraudulent acts can help.
- Communicating and educating about the detriments to the company, policyholders and other employees of immoral acts is very necessary.
- Ethics and transparency from the head of the organization is vital, a sense of fairness and business ethics as well.
In conclusion, we know that the fraud triangle not only helps us to understand the why and how of insurance fraud, but also helps us to overcome fraud and reduce fraudulent behavior of our clients.
Although we know that this vertex is one of the most accentuated, it is necessary to build a relationship based on trust with customers in order to combat the problem. This is how they will know that there are honest people behind it who may also be affected.