How is insurance fraud best defined?

Insurance fraud is best defined as any deception aimed at obtaining financial gain from an insurer. This definition captures the essence of fraud, which involves intentionally misleading or providing false information to secure a benefit or monetary gain that one would not otherwise be entitled to receive. This can take many forms, including exaggerating claims, staging accidents, or providing false information on applications.

Honest mistakes, comprehensive coverage, and failure to disclose information during underwriting do not fit the definition of fraud, as they either involve no intent to deceive or relate to procedural aspects of the insurance process rather than deceptive behavior aimed at exploitation for financial gain. Understanding this definition is crucial, as it emphasizes the intentional component of fraud, which is key in the legal and operational frameworks of the insurance industry.