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What counts as insurance fraud in Ontario?

Insurance fraud in Ontario costs of billions per year, and some drivers have found themselves unsuspecting players in an organized fraud ring’s scheme.

But fraud is a serious crime that carries heavy penalties, so it’s important to be aware of what insurance fraud is, recognize it, and how to protect yourself in case you suspect foul play.

Defining insurance fraud

Insurance fraud happens when a person deceives an insurer in order to profit financially. Fraud, however, doesn’t have to be intentional, and you can still be guilty of it even if you didn’t mean to commit fraud or didn’t know you were doing it.

When it comes to auto insurance fraud, there are also people and groups out there who target unsuspecting victims, and that’s why you need to be able to recognize fraud when you see it.    

Types of insurance fraud in Ontario

Any type of provider can fall victim to insurance fraud in Ontario, including car, home, and medical insurers. There are many ways that fraudsters try to cheat insurance companies. Here are a few examples:

  1. Exaggerating insurance claims or making claims for accidents that didn’t happen.
  2. Staging or intentionally causing a collision.
  3. Faking injuries or damage to a vehicle.
  4. Dumping vehicles.
  5. Staging a car theft or lying about the value of the car.

Furthermore, there’s also a special category for something called opportunistic insurance fraud. This means a person takes a legitimate insurance claim and uses it to get compensation for a pre-existing injury or damage that occurred prior to the accident, or exaggerating the damages and injuries incurred. This category also also applies to home insurance claims.

However, it’s possible to commit fraud unintentionally. This usually happens when someone has provided false or inaccurate information to an insurance company. For instance, if you were listed as the primary driver on a car when in fact somebody else in the household drove the car more often, that could be considered fraud.

Fraud impacts everybody

Fraud costs Ontario’s insurance industry over $1 billion every year, but insurers aren’t the only ones who suffer. In fact, every person who has insurance pays the price for fraud because direct insurance providers compensate for their losses with higher annual rates.

How to avoid committing accidental insurance fraud

Understanding what constitutes fraud is the best way to avoid committing it unintentionally, but the other key is always being honest and offering full disclosure to your insurance provider about everything to do with your policy. It’s also a great idea to keep detailed records if you’re involved in an accident and keep track of all the insurance claims you make.  

Insurance fraud in Ontario is a serious crime, and if you’re convicted, you could spend time in jail and face hefty fines. There are several actions that could constitute insurance fraud, and it’s important to know what they are so you can protect yourself.


If you suspect you’ve been victim to or witness to fraud, make an anonymous call to the Insurance Bureau of Canada to report it.

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