What is the main goal of insurance fraud laws?

The primary goal of insurance fraud laws is to prevent false claims and protect insurers. These laws are designed to deter fraudulent activities by imposing penalties for those who attempt to deceive insurance companies for personal gain. Fraudulent claims can lead to significant financial losses for insurers, which can ultimately affect the cost of premiums for all policyholders. By minimizing the incidence of fraud, these laws help to maintain the integrity of the insurance system, ensuring that legitimate claims are paid and that companies can operate sustainably.

While it might seem that facilitating faster claims processing or creating more complex policies could be goals related to claims management or insurance design, they are not the central focus of fraud laws. Instead, the emphasis is on safeguarding the interests of both the insurers and the honest policyholders by discouraging misconduct that can distort the system.