Insurance Claims Investigation/Denial

Insurance fraud is a very serious problem especially in today's economy with job loss, higher food prices, gasoline costs. In fact, everything is more expensive than it was a year ago.

There are good people that feel like they have no choice but to get rid of the car through a reported theft. They have been put into a corner of desperation. What was budgeted in last year, the bills cannot be paid this year. Maybe things were tight buying that vehicle, but it would work, and now it won't.

Some have gotten gap insurance from the dealer and insurance companies like Progressive offer this coverage under a different name when you get your policy.

Gap insurance is to cover the gap between what is owed on the vehicle and what the actual cash value of the vehicle is. Say you owe $10,000 on a vehicle that is only worth $6,000 and some cataclysmic event happens to the vehicle with the loss costing more to repair or replace (total loss), gap insurance picks up the difference.

Essentially, with gap, you could end up walking away with no financial liability concerning the vehicle.

Sounds good doesn't it? It's not a good deal because chances of getting paid on the gap insurance is slim today because of anti-theft systems and I will get into that shortly.

If your car is stolen, within 48 hours generally after you have reported the claim to the insurance company you will have to give a recorded statement over the phone of the events surrounding the theft. This will be the insurance company's first (but by far not last) to gather information about you, people in your household, information about the vehicle, the events surrounding the theft. At that time, its innocent enough, but if you make any misstatement no matter how innocent it is, it will be held against you. Be honest and be very careful as to what you say! There are "red flags" beyond your control that will come up. Unlike a criminal charge in which you are at least warned that everything you say will be held against you, in this situation you are not warned. Just remember, everything you say will be held against you if not accurate!

One of those red flags beyond your control is gap insurance. In the SIU (Special Investigation Unit) is something they look at as a potential fraudulent claim, because the insured can completely walk away from any financial liability for the vehicle.

SIU's are generally composed of ex-cops (intimidation factor), but there are some investigators that are not former law enforcement. They are indoctrinated that all theft claims are fraud, and the problem with that generalization is that many claims are fraudulent, but each claim stands on its own merit. Not every theft claim is fraud!

When givig your recorded stateent, if the conversation between the claims person has red flags such as gap insurance or equipped from the factory with an anti-theft system, the claim is commonly referred to the SIU for investigation.

This is where the claim can grow an extra leg and I will go into extreme detail on this event, but for now I will speak on general terms.

Basically put, your claim lies on the mercy of independent "Forensic locksmiths" that are assigned to determine how your ignition lock was last operated. This exam is commonly flawed and you need to realize where their loyalty falls and who is paying them. 99% of the time, their report on the theft of the vehicle controls which direction your claim will go.

If the examiner has no clue as to how vehicles are stolen, it sucks to be the insured, because their lack of a standardized analysis, knowledge as to how that anti-theft system can be circumvented, this claim will turn out to be your worst nightmare! Even if you had nothing to do with the theft, they will infer you did!

If there is no ignition lock damage (even though they may not have taken all the steps to eliminate all known hypotheses) the report will state the vehicle was last operated with a key of the "proper type." Once such a report is issued a full scale investigation ensues.

Many think if the SIU initiates an investigation, it is common for the insured to think the SIU is looking into the theft as to who stole the vehicle. The truth of the matter is, that the paradigm has now changed from the theft of the vehicle to potential insurance fraud on the part of the insured.

Tax records, employment records and cell phone records are now requested. Here is the problem: Even though you need to supply this information or the claim will be denied for non-cooperation if you don't, here are some really important concerns: You have no idea as to who will be reviewing these records with your very personal information. Identity fraud is a very extreme concern these days. You have no idea as to what they do with these records. Insurance companies commonly request these records twice. What happened to the first documents? It has been my experience to see keys and records lost with insurance companies. How do you know how they were disposed of after the claim has been disposed of? You don't!

If you are supplying this information to an insurance company or to their law firm, NEVER just hand it to someone. You may be told to bring it to the SIU or the insurance lawyer or the SIU. Never do this. Copy everything they have requested. Photograph the documents and put a letter of inventory on the top of the documentation. Photograph. Mail Certified mail through USPS, Fed X or UPS. Get a signature! Don't mind me, I trust no one and it keeps me out of trouble as it will you!

FACTORY ANTI-THEFT SYSTEMS

This is a HUGE red flag! Insurance personnel are led to believe these systems render a vehicle "unstealable."

Factory anti-theft systems do not stop a vehicle from being stolen, however the locksmiths are very limited to their locksmithery and the only thing they can do is use the factory description and operation of the system taken out of a service manual to support their opinion that the vehicle could not have been stolen. So, because of their ignorance as to the electronics and how these systems can be circumvented, your claim may be denied.

Basically, because the locksmith does not know the many different ways these systems can be circumvented, you the insured had something to do with how that vehicle was moved from the theft scene.

If the locksmith uses what he feels as a questionable theft where the vehicle was found 5 blocks away on blocks, and it was equipped with a transponder the car could not have been stolen because of no ignition damage.

If the vehicle is recovered a short distance from the reported theft scene that is another red flag as if the vehicle is recovered in less than 24 hours.

I have experienced many good thefts with transponders in which the car was found blocks away with no ignition damage. In fact, very common in big cities like Chicago and Detroit to steal wheels and tires. The transmission shift cable is stretched from force to the lever. Many cars no longer have locking steering wheels and these cars are pushed with another car blocks away to steel the wheels. Yet, no ignition damage and a good theft!

I will go far deeper into the claims investigation on another page.

hope this helps Y'all!

866-490-1673

Its common for these forensic locksmiths to give "free" seminars to the insurance companies and supply information from a locksmith with absolutely no ability to know how these systems are "unstealable" in their eyes.

In fact, to use locksmiths as the examiners of a reported stolen vehicle is a deliberate misrepresentation as it relates to theft. Lawyers, insurance companies and the general public are ignorant to the methods of theft. This is not calling them stupid. This is just saying they have no knowledge of these circumstances. They are left with the dream of how a locksmith would look at a specific car and attempt to steal it from their eyes. Many think, I start my car by turning the ignition with a key. Well, who services locks and keys? Locksmiths! This means the locksmith must be an expert in theft right? ABSOLUTELY NOT!!!!

A board member Herb Miller from the IAIL turned a complaint (one of countless complaints against me, even though they still use things they have learned from me in their exam processes-with no credit of course) for stating in an add that 95% of all steering columns could be defeated with no damage to the ignition lock. Well this affected their agenda of ignition lock analysis and they did not like it!

Here will be example of what is wrong with a forensic locksmith examining the ignition lock on a vehicle that can be stolen with no damage to the ignition and there will be many examples on different pages. This definitely illustrates the problem with the use of locksmiths whose reports will initiate an investigation on the insured.

I am under constant assault from the IAIL (International Association of Investigative Locksmiths) because of my goal of the actual truth. My agenda is to tell it how it is, favoring no one. Theirs is to generate income from insurance companies on deflection and misdirection without even performing the procedures they preach to others. This information is being added for another future page.

In fact, less than a month ago, I was assigned to examine a 1993 Suburban that was reported stolen. SIU was apprehensive because of no ignition lock damage. Well, the fine forensic locksmith would have examined the lock under the request of lock/key analysis and would have reached the conclusion that the vehicle was last operated with a proper key. Then since not knowing a thing about after market alarms, which this vehicle had would have opined the after market alarm would have prevented it from being stolen. Yes, they probably would have noted that the left side of the steering column was damaged, but would not have thought anything about it. I can state all this from 20 years experience with these forensic locksmiths!

They would have stated there was a hole below the driver's door handle, but no signs of damage to the door lock.

Now, here is the difference between having perspective as a thief and not a "Forensic Locksmith." The small hole below the driver's door handle gave access to the inner door lock mechanisms and the door can be unlocked in seconds with no damage to the door lock! The upper and lower portions of this steering column were broken. The top was broken and the thief found this column (only 93' & 94' Trucks & SUVs) with this Saginaw tilt were equipped with a protective steel sleeve to prevent access to the sector spring, lock pin and rack (internal locking mechanisms on the top portion of the column that could be accessed since 1969. The idiots (engineers at GM) went to all this work to protect the top portion of the steering column for one method of theft, but never took into the other very common method of defeat to this column since 1969at the lower portion of this column. The lower portion of this column could be broken and all the internal locking mechanisms could be accessed in seconds with a screwdriver. It has been my experience to see where a 12 year old kid could defeat this column in 30 seconds, with a screwdriver he stole at a hardware store! This Suburban could be stolen in less that a minute (and it was). Oh, but there was an alarm! Its more than common for no one to pay attention to alarms because they are always going off. Even if someone were concerned, how do they know if it was the owner that accidentally set the alarm off? No one is going to get involved. This is reality!

To disarm, the hood is popped and in this case as very common, the siren was in plain view. The wires were ripped out which silences it. The flashing lights were still operating until the slapped up module under the dash is pulled down and disconnected. So much for the alarm! Vehicle is gone!

Yet, as stated, the results of the examination would be much different if a locksmith assigned to examine the ignition would have been much different and the insured would have been denied because the lock was last operated with a key of the proper type! Do you see a problem here?

This is just one example and I will go much, much more deeper on another page about the use of Certified Forensic Locksmiths from IAIL and others when it is all about the ignition.

This is so crucial when it comes to the difference of the claim being honored and under investigation.