Insurer Fraud Section
Common Types & Schemes
Deceptive Agent Practices
- Agent Application Fraud - Agent forges an insurance application using information from an unsuspecting person to obtain commissions.
- Clean sheeting - Agent conspires to acquire life insurance without disclosing life-threatening illness.
Conversion - Agent retains customer premiums, provides the customer with fictitious insurance documents and issues fraudulent liability insurance cards. May involve the conversion of annuity funds.
Churning - Agent induces customer to use cash value of existing policy to purchase a new policy, resulting in another commission for the agent.
Fraud by Company Officials
Submission of falsified financial statements
- Misuse of company funds
- Insurance plans not authorized by the Texas Department of Insurance.
- Individuals not licensed to do the business of insurance in Texas.
- Fraudulent group/individual health plans.
Avoid Becoming a Victim When Buying Insurance
- Confirm that the company or agent is licensed
- Beware of unsolicited offers or offers to upgrade
- Beware of unreasonably low premiums
- Beware of investments that seem too good to be true
- Make sure you receive your policy within 60 days
- Protect your insurance policy numbers
- Never pay premiums in cash
Reporting Insurance Fraud
- Toll-free Insurance Fraud Hotline - 800-252-3439
- Online Reporting for Insurance Fraud
- Download Form
- Email the completed report as an attachment to: FraudReport@tdi.texas.gov(Please remember - Information sent via e-mail is not encrypted)
- Mail the printed report to:
Texas Department of Insurance
P.O. Box 149336
Mail Code 109-3A
Austin, TX 78714-9336
For more information contact:
Last updated: 07/01/2015