Burglary is just another hedged bet to an insurance company.
Insurance companies include statistics relating to burglary and theft claims in their annual investor statement in series with other claim statistics. Proactive corporate citizens in the insurance industry don't need to stop there and can forward the annual investor's statement, along with a more detailed account of individual burglary and theft related claims, to local and federal law-enforcement agencies. In the strictest sense, thefts and burglaries are just another type of coverage, though the company may warn policyholders or investors of exceptionally heightened risks in their community as a value added service, including large locational spikes in claim activity.
How Insurance Companies View Burglary and Theft Claims
To an insurance company, burglaries and thefts are simply another hedged bet. As with other types of claims, an insurance company will probably investigate the claim to ensure its legitimacy and deter fraud; insurance companies are no strangers to dealing with claims relating to unfortunate situations, such as crime and the personal tragedies of policyholders. A massive surge in a regional crime rate may reach a threshold where it's no longer profitable to offer policies of that sort in the region, but up to that point it's business as usual.
Voluntary Cooperative Reporting to Law-Enforcement
As a matter of proactive and mutually beneficial community participation, some insurance companies report claim data as it relates to theft and burglary to local, state and federal law enforcement. This not only helps law enforcement to monitor theft trends, it also serves to effectively aid the insurance company by deterring future thefts. For example, a localized surge in a single kind of theft may indicate an organized crime ring, and the data provided by the insurance company may give police the opportunity to notice the problem and respond. Some kinds of policies automatically require a policyholder to file a police report such as reporting a car theft, but it isn't a universal requirement for every theft and burglary policy. However, for policies that do not require a mandatory police report, the additional volunteered data can reveal valuable crime trends.
Theft and Burglary Statistics in the Annual Investors Statement
Annual investor statements may contain statics relating to claims vs. active policies, since they represent a profitability indicator for an insurance company. The report may also include the average payout for each category of successful claim, since numerous claims can be mitigated by a low individual payout. Conversely, a few very large claims may be worth mentioning, particularly if they yield changes in the types of policies offered. An investor's statement is intended as an accurate account of the insurance company's operations; emphasis on burglaries and thefts is not necessary even though they may be mentioned as a class of policy.
Investigative Claim Auditing and Fraud Deterrence
One kind of theft that probably won't find its way onto an annual statement is policy theft, or put more simply, fraudulent claims. Companies may mention positive outcomes relating to internal auditing staff catching claim fraud; however, being something of a general embarrassment, the company may be hesitant to mention significant cases that go undetected initially. An insurance company may employ private investigators and confer with law enforcement agencies to catch would-be cheats.
