Insurance Fraud Charges in Ontario

The short answer

Insurance fraud is usually charged as fraud under s. 380 of the Criminal Code. It covers false claims, exaggerated claims and false statements on insurance applications. Insurers investigate these cases closely, often with their own trained investigators, and an insurer's investigation can turn into a criminal charge. What you say to the insurer in the early stages can shape the entire case, so it is wise to get advice before you give a detailed statement.

Common situations

• Reporting a car, phone or other item stolen when it was not actually stolen.
• Exaggerating the value of a loss, such as adding items that were never owned.
• Taking part in a staged or invented collision.
• Making a false injury or disability claim.
• Giving false information on an application to lower a premium, such as about who drives the car.

What the Crown must prove

Related charges

• Public mischief (s. 140): Falsely reporting a crime to police, such as a fake theft, can lead to a separate charge. See public mischief.
• Forgery or uttering forged documents: Fake receipts, invoices or repair bills can lead to these charges. See credit card fraud and forgery.
• Conspiracy: This may be charged where more than one person planned the claim together.

Ontario's Insurance Act also makes it a provincial offence to knowingly give false or misleading information to an insurer. That offence is separate from the Criminal Code and is prosecuted in a different way.

How these cases are built

Insurers often use special investigators, who may ask for a recorded statement, check receipts, phone records and social media, compare the claim with repair shop and police records, and hire surveillance in injury or disability claims. Once they have gathered information, they may pass their file to police, and anything you told the investigator can become evidence in a criminal case.

Statements to the insurer

Your insurance policy may require you to cooperate with the insurer's investigation. However, cooperating does not mean you must answer every question without advice. Before a recorded interview or an examination under oath, speak to a lawyer, who can help you meet your duties under the policy while protecting your position in any criminal case.

Staged collision cases

Staged collision cases often involve several people, such as drivers, passengers, tow operators, repair shops or clinics, and police may charge many of them at once. However, each person's role and knowledge must be proven separately. A passenger who did not know the collision was planned is in a very different position from the person who arranged it.

Penalties

Fraud over $5,000 can only be prosecuted by indictment and carries up to 14 years in jail. Fraud of $5,000 or less carries up to 2 years by indictment, or it can be prosecuted by summary conviction. Courts often order restitution to the insurer, and a conviction can affect your ability to obtain insurance and to work in some licensed fields. See fraud sentences in Canada.

Civil and insurance consequences

Separate from the criminal case, the insurer may deny the claim, cancel your policy, sue to recover money it has already paid, or report the claim to an industry fraud database. These steps can make insurance harder and more expensive to obtain for years afterwards.

Defences

• Honest mistake: The information was wrong, but it was not deliberately false.
• No intent to deceive: You did not mean to mislead the insurer.
• A real loss: The loss actually happened, even if the paperwork was poor or incomplete.
• Identity: Someone else made the claim or supplied the false information.

Possible outcomes

What to do now

• Do not give a recorded statement or attend an examination under oath before you receive legal advice.
• Keep copies of your claim, receipts, photographs and messages with the insurer.
• Do not contact other people involved in the claim about the investigation.

What happens after you are charged

1. Release: Most people charged with insurance fraud are released by police with an undertaking or a court date, often with conditions about contact, devices or finances.
2. Disclosure: The Crown provides its evidence, which in fraud cases is often large and can take several months to complete.
3. Crown pre-trial: Your lawyer meets with the Crown to discuss the strength of the case, repayment and possible resolutions.
4. Resolution or trial: If the case does not resolve, it is set for trial, and the Crown must prove every element beyond a reasonable doubt.

Effects beyond the sentence

Because fraud over $5,000 carries a maximum of 14 years, a conviction can make a permanent resident inadmissible for serious criminality. Insurance fraud is also treated as a dishonesty offence, which can affect licensing in fields such as real estate, finance and health care, and it can lead to being refused entry to the United States.

How we can help

We can advise you before you speak to an insurance investigator, and defend the criminal charge if one is laid. Call (647) 223-1980 for a free consultation.

Frequently asked questions