Managing claims involving deaths outside of the United States is a unique challenge for insurers and the claim professional. Foreign deaths are often more complex, and the risk of fraud is much greater than domestic death claims. This requires the collection and analysis of information that may not be necessary for other claims. One tool that can be used to assist in the collection of information necessary to analyze a foreign death is the Foreign Death Questionnaire.
Prompt payment and fraud
Consistent with fair claims settlement regulations, insurance companies seek to pay all legitimate claims properly and timely. The majority of international death claims are legitimate, and insurance companies want to pay those claims. However, insurance companies must also seek to protect against fraudulent claims wherever they occur. Though it’s impossible to gauge how often people fake their deaths, the Coalition Against Insurance Fraud puts total insurance fraud losses at more than $80 billion annually.1 Unfortunately, anecdotal evidence indicates that as many as 25-35% of international death claims may be fraudulent. The fraudulent deaths
reported from specific countries may be even higher. For instance, some investigators believe up to 70-90% of reported death claims incurred in Haiti are fraudulent. There are even reports that fraudsters identify companies with poor investigative practices and test the waters with an exploratory claim. If the claim gets paid, there is a likelihood those companies will be repeatedly targeted. Insurance fraud has also increasingly become riddled with large transnational rings, and, in certain cases, has been used as a terrorism-financing vehicle.
International death claims are challenging
Foreign deaths can present a significant challenge, and can be very complex to investigate due to the involvement of language and cultural barriers, access to credible information, unfamiliarity with documents, and the increased difficulty of obtaining those documents. In addition, with an increasing number of individuals having access to technological advancements, creating false documents is becoming easier, making it more difficult to determine document authenticity. For example, a Google search of “buy fake death certificate” identifies about 325,000 sites where false documents can be purchased. One site boasts, “The Platinum/ Official Death Certificate: This certificate is superiorly designed and looks authentic when next to an original. It is created by using identical security grade transcript paper, embossed seals, water markings that are near identical and card stock weight that is correct to the document you need.” Now, why would authenticity, security grade paper, embossed seals, and water markings be important to someone who buys these “fake” death certificates? While fraudulent documents are easy to obtain, many countries do not have adequate controls over their official documents. All of this makes the validation of the death through additional means extremely important.Two Germany-based al-Qaeda members plotted to fake the death of one plotter in a car crash in Egypt to collect more than $6.1 million in a massive life-insurance scheme. Most of the money would help fund al-Qaeda activities. The purported crash victim, a Palestinian, then would continue to Iraq as a suicide bomber. The main plotter was a reputed al-Qaeda recruiter in Europe and received seven years in prison in Germany. The Palestinian received six years.2,3
Investigate All Claims
Most life insurance is purchased for legitimate reasons. However, fraudulent death claims involving other countries are often crimes of opportunity where the policies were taken out for legitimate purposes, yet, years later, the insured’s circumstances change. Other times, albeit infrequently, policies are purchased with the sole intent to commit fraud. Since it is nearly impossible to determine which claims are fraudulent, the best practice for an insurance company is to investigate all international death claims. However, the depth of each investigation may vary based on multiple factors, such as age of the insured, the basis for travel overseas, cause and manner of death, and, most importantly, the location of death. For some deaths, the investigation may only require a limited amount of information in addition to the typical proof of loss documents, while others may require additional documents or even a thorough field investigation where the death reportedly occurred.
An Important Tool
While not an official record of any government authority, one of the most important tools to utilize when investigating international deaths is the Foreign Death Questionnaire (FDQ). The FDQ is instrumental for determining the extent of the actual investigation required, and should be obtained early in the claim process. It should be considered as an investigative document, and, as such, should be completed for every foreign death claim.
A well-constructed FDQ, along with other proofs of loss and an interview with the beneficiary, is the starting point of the investigation, and will provide significant assistance with identifying facts that may require additional scrutiny. It is important to remember, while the FDQ is used to obtain information that will assist to verify the death so the death benefit can be paid promptly, the FDQ may identify facts indicating the death may not have occurred as reported or point to a need to investigate for additional clarification.
What’s Next?
Once received, a thorough in-depth review of the information contained in the FDQ is vital. It is important that all individuals who review international death claims have sufficient training and experience with the nuances of foreign deaths. Keep in mind, even non-contestable claims or those on policies with relatively small face amounts may be fraudulent. A $25,000 death benefit will provide a very comfortable lifestyle in many countries,
and many fraudsters believe these small face amounts will fly under the radar of many insurance companies. The type of information obtained on the FDQ is relatively straightforward and simple. In many cases, the information provided on the questionnaire, and other required claim proofs, will be sufficient to pay the death benefit. In other cases, the information will cause the insurance company to make additional inquiries or conduct a more detailed claim investigation.
Let’s Get Personal
Obtaining a few personal facts about the insured will assist with validating the deceased is the actual insured and that the policy wasn’t purchased by an imposter at time of issue, another individual’s body wasn’t substituted for the insured, or that it is a case of mistaken identity. It will also assist, along with information obtained in other sections of the FDQ, in achieving a better understanding of the insured’s travel itinerary. For instance, if the insured had any motive to intentionally disappear, or did the insured’s employment, Munich Re
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In using the contact infor ma tion provided in the FDQ, an insurance investigator had visited with the funeral director who handled a deceased’s funeral arrange ments in rural Mexico. The investigator immediately recognized him as having been involved in a fraudulent death scheme involving several million dollars several years prior. The funeral director nervously denied any knowledge about the current death. Suspicious of the funeral director’s involve ment, the investigator then visited the home of the deceased’s parent’s whose information was also provided on the FDQ and who lived within walking distance of the funeral home. When the parents answered the door and were advised the reason for the visit, they were surprised and replied, “There must be a mistake. Our son is not dead. We just spoke with him a few days ago. Come in while I call him and verify it’s a mistake.” As the investi gator listened, the nervous son pleaded with his parents, “Don’t tell them anything. I’ll explain everything later.” Of course, this claim was subsequently determined to be fraudulent.
residency, or citizenship status explain the basis and place of travel. This information is often not provided on the FDQ, and, if not, should be developed through interviews with the beneficiary, next of kin, and court searches. World wide web searches and social media sources are also important resources for this type of information.
Does the Travel Make Sense
Why did the insured travel to this location? The most common reasons for travel are vacation, business, visiting family, medical treatment, or retirement. Even with a recent significant increase in adventure tourism, some travel makes little sense. Obviously, if the death occurred in a war-torn country and the reason for travel provided is “vacation” or “retirement”, additional details may be required. In addition, it would be unusual for a U.S. resident to take a one-week vacation to a foreign country, and only purchase a one-way fare. Conversely, if a U.S. resident was a native of the country travelled to, a one-way ticket may not be unusual for an extended visit of family and friends. If the information provided doesn’t make sense, additional inquiry may be needed.
Details Tell the Tale
The details related to the cause of death are very important when evaluating an international death. If the death was natural, it may be explained by the insured’s age or medical history. If the death was caused by an accident, it’s vital to determine if there were any witnesses or police reports that will assist to verify the death. In all causes of death, there may be hospital records to assist with verification of the death. Obtaining medical records for treatment in the U.S. may also aid with the claim review. Keep in mind, all the data collected should fit together like the pieces of a puzzle. If the pieces do not fit, or there are inconsistencies, additional detail should be obtained to clarify the discrepancies. If the case is fraudulent, these additional details may expose the fraud.
Disposition of the Body
Most burials conform to standard practices regarding how a deceased individual’s body is handled. Standard practices may revolve around local customs, religious beliefs, or even an individual’s unique personal beliefs. It is important to determine that the disposition of the body fits with these customs. For example, some countries and religious practices forbid cremation. If the body was reportedly cremated in one of these locations, additional scrutiny is warranted. The responses on the FDQ should
provide sufficient information to identify any unusual events related to the disposition of the deceased’s body. For instance, if the deceased is a U.S. citizen or resident and dies while on vacation, it would be unusual for the body to not be returned to the U.S. for burial or cremation. If the body is returned to the U.S for burial, the likelihood of fraud is reduced, and the transportation company and funeral home in the U.S. may be able to provide information to verify the death. As another example, it would be unusual for a practicing Hindu to be buried. Obviously, unusual events do not prove the claim is fraudulent, but additional inquiry to explain the discrepancy may be required. Information about the body’s disposition will assist to identify potential eye witnesses who observed the death, participated in the burial, or provided documents related to the death. There may even be photographs or video from the funeral service that can be used for comparison to the insured’s passport to verify the deceased’s identify.
Follow the Money
Again, most death claims, including international death claims, are legitimate and should be paid. However, when investigating potential fraud, it may be helpful to understand who would benefit from a fraudulent scheme. The FDQ, along with the beneficiary designation on the policy, identifies details about the policy beneficiary that may alleviate any concerns. In some cases, the named beneficiary will raise additional questions. For example, if the beneficiary resides in a country other than where the insured lived or died, or if the beneficiary has no insurable interest in the policy, additional scrutiny may be required.
Supporting Documents
In many cases, it may be necessary to compliment the information obtained on the FDQ with other travel documents for further verification and comparison. The original passport, not a photocopy that can be easily altered, can verify the dates of departure and entry into a country. The travel itinerary, burial permits, cremation receipts, memorial programs, or obituary notices may also provide additional clarity. In some cases, it will be necessary to send an investigator to the place of death to verify the details provided on the FDQ and other documents. For example, in a few countries the burial practices may be so basic that the only proof of cremation is the receipt for the purchase of the wood used in the fire. In such cases, a seasoned investigator can often identify if the burial permit is consistent with local law and is signed by the appropriate authorities.
Summary
A Foreign Death Questionnaire is an essential tool when investigating international death claims and should be obtained early in the claim process. A well constructed FDQ is the starting point of the investigation and provides sufficient information to determine the extent of the investigation. Any insurance company that is not utilizing a Foreign Death Questionnaire is missing a vital item from its tool box.
References:
1http://www.insurancefraud.org/IFNS-detail.htm?key=17475 2http://www.insurancefraud.org/article.htm?RecID=3350#plotter
3Terrorism and Transnational Crime: Foreign Policy Issues for Congress, John
Rollins & Liana Sun Wyler, October 19, 2012. http://fpc.state.gov/documents/ organization/200053.pdf Munich Re Foreign deaths Page 4/4 Curtis McAdams Account Representative, Life Claims Munich American Reassurance Company Karen Riendeau Account Representative, Life Claims Munich American Reassurance Company
© 2014 Munich American Reassurance Company, Atlanta, Georgia
Date of birth Place of birth Was deceased a U.S. Citizen? Yes No If no, Country of Citizenship Passport #
Occupation Date last worked National ID #
Employer (Name and Address) Social Security #
Did the deceased have any other life or accidental death insurance coverage?
Yes No
If yes, provide company name(s)/and amount(s)
TRAVEL INFORMATION
Date deceased left U.S. (or Canada) Intended duration of
trip
Intended itinerary (attach copy if available Purpose of trip
Travel Companions
Name Address (Street, City, State, Zip Code) Phone #
( ) ( ) ( ) Was a travel agent used?
Yes No
If yes, provide name, address and phone #
Airline used when departing from U.S. (or Canada) Flight #
Airport departed from Interim airport(s) Airport arrived at
Was return flight booked? Yes No
If yes, give ticket information
HEALTH INFORMATION OF DECEASED
Please note any significant health conditions the deceased had been diagnosed with or treated for prior to taking the trip
Please list any medications deceased was taking at the time of departure
Physician in U.S. (or Canada) - Name Address, Phone #
What was the deceased’s overall health status at the time of departure?
DETAILS OF DEATH
Foreign address at time of death Nature of address:
Hotel Private home of : _______________________
Other: ________________________________Exact place of death Date and time of death
Accident Details of accident
Names and address of witnesses
Names of police officer(s) and police department involved
Natural causes Nature of illness Date illness began
Circumstances leading to death
In either case Name(s) and address(es) of all hospital(s) involved
Name(s) and address(es) of all attending physicians
Name of physician certifying death
Was there an autopsy? Yes No Any postmortem or inquest Yes No
Was the U.S. Embassy
or Consulate involved? Yes No
If yes, give details and attach copy of Report of Death of an American Citizen Abroad.
Name(s) and address(es) of other person(s) having information regarding the insured’s death
Attach any newspaper articles related to insured’s death. BURIAL/CREM
ATION/
ENTOMBMENT
Deceased was Entombed
Buried Cremated
Place (name and address) of cremation, burial or entombment
What documentation was obtained to permit burial, cremation or entombment? Attach copies if available.
Name, Address, and relationship of person who made the arrangements
Please describe any funeral or memorial services, including date and place
Names and address of two people not related to the deceased who were present at funeral/memorial service
Name Address
PERSONAL INFORMATION
Name (print)
OF CLAIMANT Address
Social Security Number Relationship to deceased Date of birth
I hereby declare that the foregoing information is true to the best of my knowledge and belief.
