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The Top 5 Insurance Claim Scandals

This interesting guest post is from Travis Holmes, a financial and health blogger with a passion for frugality. He believes that though personal investments can be costly, we should be honest and respectful.

Insurance is an expense that many try to reduce. We obtain policies not only to fulfill requirements but for the protection they provide. Some seek to take advantage of the insurance system. Using sometimes elaborate schemes to make money they result in some highly publicized claim scandals.

1. Health Insurance Premium Fraud

It’s not always the policyholder that commits insurance fraud. Health insurance agent James Lee Graff ran an elaborate scam that involved withholding premiums that policyholders paid and giving them a fake policy. The insurance companies never received the money and therefore policy holders were not able to use the insurance they paid for. Graff robbed 30,000 policyholders for a total of over $40 million.

2. John Darwin’s Death

John Darwin was known for his obsession with becoming rich. Like many people who dream of being rich his involved buying property and even a new wife from exotic Central America. However the 57 year old was married with children and worked a series of middle income jobs. He tried entrepreneurial pursuits such as breeding snails and making garden gnomes. Then Darwin moved on to the stock market and ran up credit cards to support a failing trading habit. Drowning in debt he faked his own death by pushing his red canoe out to the North Sea where he lived. Instead of drowning, his wife picked him up a short time later and dropped him off at a railway station. She collected 125,000 pounds of life insurance money on his behalf which was enough for him to live comfortably on while debt was erased by his “death.” The fantastic tale of how he lived secretly in his own home, while hiding from even his sons, is detailed in the BBC drama Canoe Man.

3. The Horse Murders Scandal

An example of how the scam worked was the death of a horse named Henry the Hawk. Owned by a young rider named Lisa Druck (also known as Rielle Hunter of John Edwards affair fame) rode the horse whose money was controlled by her father James. He was implicated in a plot to electrocute horses for insurance money and after attempting to sell the horse he hired someone to kill it. Not only did he train the killer but provided the tools. The horse’s insurance policy was worth $150,000 which was also his original asking price for its sale. The scam worked and he was one of many to collect insurance money fraudulently for horse death. The scam spanned twenty years from the 1970’s until mid 1990’s and included other forms of deception in horse valuing, pricing, etc.

4. Missing Art

In 1990 a Los Angeles ophthalmologist named Steven Cooperman committed insurance fraud. He choreographed a home burglary that would result in the theft of artwork. This included two pieces of high value, a Monet and a Picasso. The insurance was in the amount of 17.5 million and was awarded. In 1999 he was convicted of fraud.

5. The Slip & Fall Trick

The risk of slipping and falling in public is real. Retail establishments attempt to prevent these issues by cleaning up and marking slippery areas and training employees on safety. Then along comes someone such as Isabel Parker whose 49 claims earned her the title, Queen of the Slip & Fall. Her fraudulent claims also earned her a total of $500,000 of insurance money.

Bob Kraft

I am a Dallas, Texas lawyer who has had the privilege of helping thousands of clients since 1971 in the areas of Personal Injury law and Social Security Disability.

About This Blog

The title of this blog reflects my attitude toward those government agencies and insurance companies that routinely mistreat injured or disabled people. As a Dallas, Texas lawyer, I've spent more than 45 years trying to help those poor folk, and I have been frustrated daily by the actions of the people on the other side of their claims. (Sorry if I offended you...)

If you find this type of information interesting or helpful, please visit my law firm's main website at You will find many more articles and links. Thank you for your time.

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