AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Question 1. Which of the following is considered “hard” insurance fraud?
A) Inflating a legitimate claim
B) Failing to disclose a previous accident on an application
C) Deliberately staging a car crash
D) Forgetting to update contact information
Answer: C
Explanation: Hard fraud involves deliberate acts to create false claims, such as staging accidents,
while soft fraud is opportunistic exaggeration.
Question 2. What is the primary impact of insurance fraud on policyholders?
A) Reduced claim processing times
B) Increased insurance premiums
C) More comprehensive coverage
D) Lower deductibles
Answer: B
Explanation: Fraud increases costs for insurers, which are passed on to policyholders through
higher premiums.
Question 3. Which regulatory body developed the Insurance Fraud Prevention Model Act?
A) National Association of Insurance Commissioners (NAIC)
B) Federal Bureau of Investigation (FBI)
C) Department of Justice (DOJ)
D) Securities and Exchange Commission (SEC)
Answer: A
Explanation: NAIC created the model act to help standardize anti-fraud regulations across
states.
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Question 4. What psychological factor commonly motivates individuals to commit insurance
fraud?
A) Lack of education
B) Financial pressure
C) Political beliefs
D) Environmental factors
Answer: B
Explanation: Financial pressure is a major motivator, often coupled with rationalization and
perceived opportunity.
Question 5. Which of the following is an example of property and casualty insurance fraud?
A) Faked death for life insurance payout
B) Billing for unperformed medical services
C) Arson for profit
D) Malingering in workers’ compensation
Answer: C
Explanation: Arson for profit is a classic example of property and casualty fraud.
Question 6. In automobile insurance fraud, what is a “swoop and squat” scheme?
A) Falsifying vehicle registration documents
B) Staging a rear-end collision with multiple vehicles
C) Overstating repair costs
D) Selling counterfeit insurance policies
Answer: B
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Explanation: “Swoop and squat” involves orchestrating a collision with multiple cars to make
fraudulent claims.
Question 7. What constitutes “unbundling” in medical insurance fraud?
A) Combining multiple procedures under one billing code
B) Billing each procedure separately to maximize reimbursement
C) Charging for services not rendered
D) Falsifying patient records
Answer: B
Explanation: Unbundling means billing each procedure separately to inflate overall
reimbursement.
Question 8. Which of the following is a common red flag in workers’ compensation fraud?
A) Multiple injuries reported at different companies
B) Immediate return to work after injury
C) Regular reporting of income during disability
D) Clear documentation of medical treatment
Answer: A
Explanation: Frequent injuries at different jobs may indicate fraudulent activity.
Question 9. What is “premium diversion” in internal insurance fraud?
A) Overcharging for premiums
B) Agent pockets premiums instead of sending to insurer
C) Creating fake policies
D) Underwriting policies below market value
Answer: B
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Explanation: Premium diversion occurs when agents keep premium payments rather than
remitting them to insurers.
Question 10. What is the first step in the insurance fraud investigation process?
A) Surveillance operations
B) Initial detection and identification of red flags
C) Filing a lawsuit
D) Interviewing witnesses
Answer: B
Explanation: Detecting indicators or red flags is the starting point for an investigation.
Question 11. Which database is commonly used to identify connections in insurance fraud
cases?
A) ISO ClaimSearch
B) LexisNexis
C) Bloomberg Terminal
D) Experian
Answer: A
Explanation: ISO ClaimSearch helps investigators find links between claimants and past
fraudulent activity.
Question 12. What is the chain of custody in evidence collection?
A) The order in which insurance policies are processed
B) The documentation process for handling evidence
C) A method for interviewing witnesses
D) A technique for analyzing financial records
CIFIP Exam
Question 1. Which of the following is considered “hard” insurance fraud?
A) Inflating a legitimate claim
B) Failing to disclose a previous accident on an application
C) Deliberately staging a car crash
D) Forgetting to update contact information
Answer: C
Explanation: Hard fraud involves deliberate acts to create false claims, such as staging accidents,
while soft fraud is opportunistic exaggeration.
Question 2. What is the primary impact of insurance fraud on policyholders?
A) Reduced claim processing times
B) Increased insurance premiums
C) More comprehensive coverage
D) Lower deductibles
Answer: B
Explanation: Fraud increases costs for insurers, which are passed on to policyholders through
higher premiums.
Question 3. Which regulatory body developed the Insurance Fraud Prevention Model Act?
A) National Association of Insurance Commissioners (NAIC)
B) Federal Bureau of Investigation (FBI)
C) Department of Justice (DOJ)
D) Securities and Exchange Commission (SEC)
Answer: A
Explanation: NAIC created the model act to help standardize anti-fraud regulations across
states.
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Question 4. What psychological factor commonly motivates individuals to commit insurance
fraud?
A) Lack of education
B) Financial pressure
C) Political beliefs
D) Environmental factors
Answer: B
Explanation: Financial pressure is a major motivator, often coupled with rationalization and
perceived opportunity.
Question 5. Which of the following is an example of property and casualty insurance fraud?
A) Faked death for life insurance payout
B) Billing for unperformed medical services
C) Arson for profit
D) Malingering in workers’ compensation
Answer: C
Explanation: Arson for profit is a classic example of property and casualty fraud.
Question 6. In automobile insurance fraud, what is a “swoop and squat” scheme?
A) Falsifying vehicle registration documents
B) Staging a rear-end collision with multiple vehicles
C) Overstating repair costs
D) Selling counterfeit insurance policies
Answer: B
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Explanation: “Swoop and squat” involves orchestrating a collision with multiple cars to make
fraudulent claims.
Question 7. What constitutes “unbundling” in medical insurance fraud?
A) Combining multiple procedures under one billing code
B) Billing each procedure separately to maximize reimbursement
C) Charging for services not rendered
D) Falsifying patient records
Answer: B
Explanation: Unbundling means billing each procedure separately to inflate overall
reimbursement.
Question 8. Which of the following is a common red flag in workers’ compensation fraud?
A) Multiple injuries reported at different companies
B) Immediate return to work after injury
C) Regular reporting of income during disability
D) Clear documentation of medical treatment
Answer: A
Explanation: Frequent injuries at different jobs may indicate fraudulent activity.
Question 9. What is “premium diversion” in internal insurance fraud?
A) Overcharging for premiums
B) Agent pockets premiums instead of sending to insurer
C) Creating fake policies
D) Underwriting policies below market value
Answer: B
, AIIM Certified Insurance Fraud Investigation
CIFIP Exam
Explanation: Premium diversion occurs when agents keep premium payments rather than
remitting them to insurers.
Question 10. What is the first step in the insurance fraud investigation process?
A) Surveillance operations
B) Initial detection and identification of red flags
C) Filing a lawsuit
D) Interviewing witnesses
Answer: B
Explanation: Detecting indicators or red flags is the starting point for an investigation.
Question 11. Which database is commonly used to identify connections in insurance fraud
cases?
A) ISO ClaimSearch
B) LexisNexis
C) Bloomberg Terminal
D) Experian
Answer: A
Explanation: ISO ClaimSearch helps investigators find links between claimants and past
fraudulent activity.
Question 12. What is the chain of custody in evidence collection?
A) The order in which insurance policies are processed
B) The documentation process for handling evidence
C) A method for interviewing witnesses
D) A technique for analyzing financial records
