Greatest Insurance Scams of All Time

Posted on August 23, 2021

Every year, insurance claims are filed for a variety of reasons. Most of these are legitimate—but quite a few are nothing of the sort. 

It turns out that insurance fraud can cost legitimate consumers upwards of $1 billion each year. That's a significant chunk of money, and no laughing matter for those who end up footing the bill. 

Still, we can't help but admire, or ridicule, some of the worst insurance fraud schemes perpetrated in recent history. To that end, we've compiled a list of five of the greatest insurance scams of all time. 

1. Four Women and a Funeral

We may as well start off our list of the greatest insurance scams with one of the weirdest. 

California is known for being home to Tinsel Town and the glamour of Hollywood, and this story of insurance fraud gone wrong in the Golden State is worthy of an Oscar or Emmy at least. 

The mastermind was Jean Crump, a former mortuary worker. Together with her merry band of fraudsters, she actually created a fake man (plenty of those in California) named "Jim Davis," and then staged his "death." 

As if that wasn't enough, the women made fake death certificates and staged a bogus funeral complete with a burial plot and empty casket. They even hired actors to pose as mourners at the phony funeral. 

The idea was to claim $1.2 million worth of life insurance benefits. Unfortunately for the crooks, the insurance companies became suspicious and opened investigations into the case. Crump and her cohorts had the casket exhumed, filled it with a mannequin and cow bones (for the sake of veracity), and had the whole thing cremated. 

The FBI eventually caught up with the ladies and convicted them for what is surely one of the weirdest and worst insurance fraud scams ever perpetrated. 

2. The Darwin Award

This is the strange story of a man named John Darwin. 

In 2002, after a kayaking trip near Seaton Carew in North East England, John Darwin failed to return to work and was reported missing. A search-and-rescue mission turned up nothing, and he was presumed dead. 

Of course, that's not the end of the story. John Darwin had staged his death and now it was time to have a little fun. For a while, he lived in a house next to his old one, before ending that pointless charade and just moving back into his old home. 

In the meantime, his wife obtained a death certificate and collected life insurance on her "dead" husband. The two travelled to exotic destinations before settling in Panama in what was supposed to be a fun, tropical retreat. 

That all came to an end when Panama changed its visa laws, and John Darwin realized that his uncreative alias of "John Jones" wouldn't pass muster. It was about that time that John Darwin suddenly "reappeared" in London in 2007. He claimed he was an amnesiac and had no memory of the previous five years. 

And that's too bad because it sounds like he was having a lot of fun. The bobbies didn't buy a bit of it, and John Darwin was sentenced to six years in prison. 

3. Hands Off

This one's not very pleasant. 

In the pursuit of insurance fraud, it makes sense to fake your death at sea and then kick back in Panama. Even if you get caught, you're still whole in body and mind. 

But that wasn't enough for our next batch of geniuses. In an attempt to collect money on a dismemberment claim, one Gerald Hardin of South Carolina and another man concocted a truly grisly scheme. 

They tied a mentally disabled man's hand to a branch and then used a pole saw to lop it off. They took the man to a hospital, where all attempts to reattach the severed hand proved fruitless. 

The other man in the scheme filed an insurance claim and collected over $670,000. For his help, Hardin received some money for a new truck loan and to help out with his rent. No word on what the handless guy was promised, if anything. 

4. Clean-Up in Aisle 9

Isabel Parker, 72, of Philadelphia, found herself in something of a jam. 

She had a serious gambling addiction but didn't have the money to support it. So she did what any of us would do: planned and executed almost 50 slip-and-fall insurance scams throughout various supermarkets and liquor stores over a seven-year period. 

It was enough to make her the undisputed "Slip-and-Fall Queen of Philadelphia," and she used a slew of aliases to file numerous claims totalling $500,000. Insurance detectives finally nabbed her, and she was sentenced to 4 years behind bars. 

5. Back From the Dead

People go to some incredible lengths when it comes to insurance fraud. It's hard to beat dismemberment, but disinterring the dead in the pursuit of an insurance scam seems a little excessive. 

But this is what Clayton Williams of Texas did. He exhumed the corpse of an 81-year-old woman, decked the body with his own clothes, and then burned the corpse before sticking it in his car. 

The idea was to claim that Clayton had perished in a car accident. So Clayton's wife Molly dutifully tried to collect $110,000 from his life insurance policy. 

However, as with our other cases, no one was buying it. The police conducted an investigation, and found Clayton miraculously alive at home, sporting a new hair colour. 

The gruesome body snatcher and his wife were both put away for a considerable period of time. 

Avoid Insurance Scams: Do Insurance the Right Way

These are some of the strangest and biggest insurance scams of recent decades.

They range from the macabre to the goofy to the grotesque. They're often amusing, but insurance fraud isn't a laughing matter. So don't take this list as an inspiration. 

Do insurance the right way, the legal way, and contact Insurdinary today to get the best insurance rates! 

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