[分享]Fortune: Fire Sale

[分享]Fortune: Fire Sale

台灣英語網1.0 » 週五 8月 21, 2015 2:10 pm

I was doing my weekly reading and found this very interesting article... it basically link how the subprime crisis can related to your neighbor's house on fire!

In short, every house in US has some kind of insurance coverage and most of them have fire coverage. So, the idea here is that if one can't afford the mortgage anymore with raising rate, instead of defaulting on the mortgage payments and have the house auctioned off, just burn the house! That way, not only the insurance company has to make the mortgage payments for you and depend on the coverage, the insurance company may also need to pay your hotel bill while the house is been reconstructed.



引文:

source: Fortune

As homeowners get more desperate, the insurance industry is bracing for an increase in arson.

By Jon Birger, senior writer

NEW YORK (Fortune) -- Faced with foreclosure on her Russellville, Indiana home, Christina Snyder allegedly concocted the kind of plan that now has insurance executives on edge.

According to the county prosecutor, the 31-year-old Snyder allegedly offered to pay a neighbor $5,000 to help her burn down her house and make it look like a botched rape attempt - all in order to claim $80,000 in insurance money. Snyder wanted the neighbor to bind her hands in duct tape, write "whore" on her shirt, and then help her escape once the blaze was set, the prosecutor says. The neighbor demurred, instead reporting Snyder to police.

With the national foreclosure rate zooming and the real estate market in a two-year funk, the insurance industry fears more homeowners will see arson as a way out of their financial woes. A recent report by the industry-funded Coalition Against Insurance Fraud notes that with "untold thousands of homeowners struggling with ballooning subprime mortgage payments, fraud fighters are watching closely for a spike in arsons by desperate homeowners who can no longer afford their home payments."

History indicates such a spike is coming. "When the economy is down, we see an increase in fraud," says Dennis Schulkins, a claim consultant in State Farm's Special Investigative Unit.

It may already be happening. Allstate ( ALL, Fortune 500) spokesman Mike Siemienas says his company has seen an increase nationally in arsons among homes in foreclosure. In California, the state�s insurance division reports that the number of questionable residential fires in 2007 increased 76 percent over 2006.

National arson statistics for 2007 aren't yet available, but Federal Bureau of Investigation crime data shows there was a significant uptick - 4 percent - in suburban arson in 2006, when the real estate downturn began to take hold. The arson increase in 2006 marked a change from the prior three years when suburban arson fell 3 percent, 5 percent and 6 percent, respectively. Says Dennis Jay, the Coalition Against Insurance Fraud's executive director, "It's a growing problem."
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Re: [分享]Fortune: Fire Sale

台灣英語網1.0 » 週五 8月 21, 2015 2:10 pm

Oh my... I wonder if that's why we had two fires on the local news in one day a few days ago....
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