A little background first: I work in customer service for a major provider of auto insurance (yup, that one). As you may imagine, we deal with tons of insurance fraud.
One of the most common forms of fraud we deal with is rated location fraud, or rate jumping. This is when a customer misrepresents where their vehicle is located for the purpose of paying lower insurance rates. In some of the more blatant cases, people say they live somewhere like upstate NY, but they really live in Brooklyn (an area with very high insurance rates- much higher than upstate- and anyone who’s driven there knows it’s warranted).
This story comes from my old supervisor, back during his days as a sales agent (who we’re going to call Rick from now on). He got a call from a guy looking to quote a new policy, and he could immediately tell that this guy was being shifty. One second, he lived in one city (city A)- the next second, he lived in a nearby city in a neighboring state (city B).
Now, Rick knows exactly what game this guy is trying to play- clearly, this guy wanted a quote for both locations, and he was going to take whichever one had the cheaper rate. However, it isn’t Rick’s job to decide whether or not this guy is lying (nor should it be)- if he is lying, underwriting will find out when/if the policy gets written. So Rick plays along.
Rick starts by quoting a policy for this guy in city A, and this guy’s driving record is about as clean as a Taco Bell bathroom about an hour or so after all of the bars in town close for the night. This guy got the worst rate my company will write in that state, which is definitely something you have to earn (in other words, if he had perhaps gotten one more ticket, we would have rejected him for a policy… and that takes a lot).
Now, if you remember from above, city B is in a different state. Different states have different underwriting guidelines. A lot of you may see where this is going… Sure enough, Rick had to redo a quote for this guy, this time in city B. Guy gets rejected for a policy in city B, which means we will no longer insure him at all.
Shame that we lost out on such a quality client. 🙂