Increased Likelihood of Insurance Fraud Among Younger Adults

Young individuals are significantly more prone to contemplating insurance fraud compared to older generations, a trend consistent with other age-related fraudulent behaviors.

According to research by the University of Georgia, participants in an investigation concerning actions like inflating claims from previous incidents or lying on insurance applications to secure better coverage indicated that 40% were willing to engage in such activities. This demographic typically ranged between 25 and 34 years old and often justified their actions as a means to save money or assist friends.

In contrast, the same study found that less than 5% of respondents aged 55 and above endorsed similar behaviors. These findings imply that older adults might have a stronger ethical framework influencing their views on fraud.

Negative Perceptions Towards Insurance Companies

Across all age groups, there was a general negative sentiment toward insurance companies. However, younger individuals were noted to engage in more impersonal interactions with these entities and often perceived fraud as not harmful due to the large companies’ ability to absorb losses.

“Younger adults are increasingly comfortable carrying out most types of fraud,” stated Jennifer Pitt, Senior Analyst for Fraud Management at Javelin Strategy & Research. “They justify their actions by citing their difficult financial situations and believing that committing fraud against large companies is harmless since those organizations can afford the losses.”

Many young adults also viewed insurance companies as merely profiteering from hardworking people, thereby rationalizing their fraudulent activities.

Lack of Clarity on Ethical Boundaries

The surveyed younger participants demonstrated a lack of clear understanding regarding the line between questionable but not outright fraudulent claim practices and genuine fraud. They changed their stance only when they anticipated severe personal or wider repercussions from their actions.

This behavior was highlighted by incidents such as the wave of check fraud against Chase Bank in 2024, driven by a viral TikTok post. Many participants convinced themselves that they were merely taking advantage of what they perceived as a bank “glitch” rather than committing fraud.

“Past decisions often involved balancing personal ethics or gauging the risks versus potential rewards,” noted Pitt. “Contemporary youth are increasingly making choices based on factors other than moral considerations or risk-reward analysis when considering criminal activities like fraud.”