Foremost Fights Fraudulent Insurance Claims - News

Foremost Fights Fraudulent Insurance Claims

Every time someone chooses to commit insurance fraud, the effects run deep. Some may think there is no direct impact from a padded or forged loss, but that’s not true. Even one fraudulent claim increases the loss and investigation expenses for an insurance company and those costs are passed along to customers through increased premiums.

Arson reduced a small SUV to a pile of scrap metal in less than fifteen minutes.

This is especially relevant now because as you’ve probably heard; insurance fraud, including arson, is on the rise. According to the National Insurance Crime Bureau, claims related to suspicious vehicle fires or arsons were up 27 percent in the first quarter of 2009 compared to the same period last year.

Foremost and our affiliated Companies work hard to make sure our claims are paid accurately and quickly, and to ensure that all claims are legitimate.

To learn more about arson fraud, eight members of the University of Farmers, Claims and Farmers HelpPoint^® who are dedicated to Foremost attended a Structural Mobile Property Live Burn Seminar put on by the Michigan Arson Prevention Committee (MAPC). The event offered a forum to discuss fire trends seen in the field by police, fire, and insurance professionals and the opportunity for attendees to observe the characteristics of fires.

"Most people haven’t seen a live burn,” commented James LaBuhn, the executive director of the MAPC, "this business is really hands-on; you have to see it to know what happens.”

Throughout the day, the coordinators of the event recreated fire situations, both accidental and incendiary. Participants were able to inspect the units before and after the burns.

One key observation was how difficult it was to start a fire in an automobile or recreational vehicle without ventilation. Newer models are so airtight, a fire will typically burn through its fuel and just self extinguish. However, when a fire was started with an accelerant and fueled by oxygen, it took less than eight minutes to start collapsing a fifth-wheel.


An incendiary fire was started in a travel trailer.	Four minutes later, the trailer was engulfed in flames.	Eight minutes later, the trailer was destroyed.

One participant also noted the difference drywall made in a garage fire. It took twice as long for the fire to collapse the side of the garage that was drywalled compared to the side that wasn't. That’s something to consider when building or remodeling a garage.

Members of our staff also had the ability to learn from and network with police and fire department investigators. "By attending these seminars and supporting the MAPC, we help get the Foremost name out there with the local fire and police departments,” said Brian Dykhouse, University of Farmers, Claims training specialist.


A personal watercraft the University of Farmers, Claims donated to the event.	A gasoline spill out of the tank was ignited.	All that was left was a burnt shell, handlebars and part of the motor.

Foremost’s seven-year relationship with the MAPC goes beyond donating items for these live burns. The MAPC’s Modular Home and Appliance Failure Fire School comes to Farmers Caledonia, Michigan campus to study the intricacies of manufactured home construction in our training facility that could make a difference when fighting and investigating fires. In return, our employees receive valuable education from the people who investigate fire every day, which helps our claims representatives inspect fire claims more diligently.

Investigating suspicious fires can ultimately help deter people from attempting to commit fraud against Foremost in the first place. "If an insurance company actually does these types of investigations, it gets out there really quick,” commented Spl/Sgt. Dale Hardy of the Michigan State Police’s Fire Investigation Unit on how word of mouth spreads among arsonists.

By equipping employees with the education to question suspicious claims, Foremost can hopefully help slow a growing trend and help keep premiums from going up due to arson claims.