Writer’s Question: In insurance fraud investigations, would an investigator work directly for the insurance carrier or a firm representing them?
Guns, Gams, and Gumshoes’s Answer: Insurance fraud is often contracted through the special investigations unit, or SIU, which is a group of specialized insurance adjustors and in-house investigators for an insurance company. These in-house investigators aren’t investigators in the purest sense of the word — they instead manage other SIU employees, outside contract investigators and attorneys (in other words, they are more managers than investigators). The reason being that insurance companies don’t want to be seen as conducting investigations that might result in the denial of their policy holders’ claims. This potential conflict of interest gives rise to the need to hire outside private investigators or investigative agencies.
Private investigators in this type of work need to have experience in insurance coverage, adjusting matters, as well as other general investigative skills. Such a PI could be hired by either the SIU, in-house counsel at the insurance company, or a private attorney who has been retained by an insurance company. Who does the hiring of a private investigator is a function of whether or not the case is in litigation or claim status.
We know a former expert insurance adjustor who left the insurance business to open his own insurance fraud investigations agency (representing bad faith insurance claimants). He’s made a lucrative business of this because he so well understands the inner workings of insurance companies.
Have a great weekend, Writing PIs
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