Misrepresenting the nature of an accident to obtain insurance money for a loss not covered by the insurance policy is definitely unethical and will cause serious harm to insurers. The purpose of this paper is to investigate this issue and examine the impacts of insurance coverage and fraud sizes on the consumer attitudes toward the false representation.
Questionnaire surveys were collected with 210 adults in Taiwan.
Results indicated that insurance coverage affected ethical judgment and perceived fairness, and ethical judgment and perceived fairness related to the false representation. Perceived fairness is related to ethical judgment (the more people feel it is fair to cheat, the higher propensity they have to deem the cheating as ethical).
Concern for claim fraud in the insurance market has dramatically increased over the past few years. However, very little research has examined the impacts of coverage and fraud sizes on such behavior. This paper takes a further step in testing the effects of the two factors on individuals' intentions to commit false representation. The results suggest that coverage does affect the intention to misreport claim amounts.
