What characterizes Hard Fraud in insurance?

Hard fraud is characterized by the deliberate planning or creation of a loss with the intent to file a fraudulent claim. This form of fraud involves premeditated actions, where the individual actively makes arrangements to suffer a loss, such as staging an accident, committing arson, or intentionally damaging property. The primary motivation behind hard fraud is the expectation of receiving financial benefits from the insurer without having incurred any genuine loss.

In contrast, other types of fraud, such as exaggerating details of an actual claim or underreporting damages, do not involve the active creation of a loss. These actions may still be deceptive but lack the direct planning and intent that defines hard fraud. Therefore, the distinct element of intent and premeditation is what sets hard fraud apart as a significant and aggressive violation of insurance practices.