Asked by Jazzy Asberry on Jun 13, 2024
Verified
Andre insured his automobile against theft under a policy of insurance. Shortly after he had insured the vehicle, he found himself short of cash, and offered to sell the vehicle to his friend for $500 if his friend would dismantle it for parts. Andre did not tell his friend that he intended to claim that the car had been stolen. His friend bought the car for $500 and dismantled it. If the insurer, unaware of the fraud, paid Andre for the claimed loss of his automobile, the insurer is entitled to a transfer of the title to the vehicle.
Insurance Fraud
The act of deceiving an insurance provider with the aim to receive compensation or benefits unjustly.
Theft
The act of stealing; taking someone else's property without permission or legal right.
Insurance Policy
A contract wherein an insurer agrees to compensate the insured for specified losses, damages, illness, or death in return for premiums paid.
- Identify the legal and ethical issues related to insurance practices, such as fraud and misrepresentation.
Verified Answer
NK
Nasir KhalidJun 14, 2024
Final Answer :
True
Explanation :
When an insurance company pays out a claim for the loss of a vehicle, they are typically entitled to take possession of the vehicle if it is later recovered. In this case, despite the fraudulent circumstances, once the insurer compensates Andre for the claimed loss, they would have the right to the title of the vehicle, as they have effectively 'bought' the remains of the vehicle through the insurance claim payout.
Learning Objectives
- Identify the legal and ethical issues related to insurance practices, such as fraud and misrepresentation.