The burden of proof in insurance fraud is one of the most decisive factors in disputes between policyholders and insurers. When an insurer accuses you of fraud and denies your claim on that basis, the question immediately arises: who must prove what? Must you demonstrate that you did not commit fraud, or must the insurer prove that you did commit fraud? The answer to this question can make the difference between a successful defence and a lost case. This article explains how the burden of proof in insurance fraud is allocated, what evidence is required and how you can use this to your advantage.
The starting point: the insurer bears the burden of proof
Dutch rules of evidence are based on the main rule that the party who relies on the legal consequence of certain facts bears the burden of proving those facts. In the context of insurance fraud this essentially means that the insurer who alleges that fraud has been committed must prove it. The burden of proof in insurance fraud therefore lies in principle with the insurer. Concretely, this means that the insurer must show that the insured intentionally provided incorrect information with the aim of misleading the insurer. A mere suspicion of fraud is insufficient. The insurer must present concrete facts and circumstances that substantiate the accusation of fraud. If the insurer fails to do so, it cannot refuse payment on the ground of fraud.
Article 7:941 paragraph 5 BW: the legal framework
The legal basis for refusing a payment because of fraud is Article 7:941 paragraph 5 of the Burgerlijk Wetboek (BW, the Dutch Civil Code). This provision stipulates that the right to payment lapses if the policyholder or the person entitled to payment has failed to comply with an obligation as referred to in the preceding paragraphs with the intent to mislead the insurer. The key words here are “intent to mislead the insurer”. It is not sufficient that the information provided was incorrect; the insurer must prove that the provision of incorrect information was intentional and aimed at deception.
What must the insurer prove?
The burden of proof in insurance fraud imposes a number of specific
evidentiary obligations on the insurer.
Provision of incorrect or incomplete information
First, the insurer must demonstrate that the insured actually provided incorrect or incomplete information. This can involve exaggerating the damage, inventing an incident, withholding relevant information when reporting the damage or falsifying documents. The insurer must substantiate the inaccuracy with concrete
means of evidence such as document analysis.
expert reports,
witness statements,
technical
investigation
or
Intent to deceive
Proof of intent to deceive is usually the most difficult part for the insurer. Intent is an inner state of mind that is not directly observable. The insurer must infer from the facts and circumstances that the insured had the intention to deceive. Factors to be considered include the nature and extent of the inaccuracy, the degree to which the insured should have known that the information was incorrect, any financial motives and the insured’s conduct during the investigation.
Causal connection
The insurer must also make plausible that there is a connection between the provision of incorrect information and the payment requested. If the incorrect information has no effect on the entitlement to payment or its amount, there may be no deception within the meaning of the law.
The insured’s burden of proof
Although the primary burden of proof lies with the insurer, the insured also has an evidentiary position. The insured generally bears the burden of proof for the occurrence of the insured event and the extent of the damage. This means that you as an insured must demonstrate that a covered loss event occurred and the extent of the damage. In practice this leads to an interaction. If the insured shows that a covered event occurred, the attention shifts to the insurer, which must prove that fraud nevertheless occurred. The burden of proof in insurance fraud is therefore not one-way traffic but a dynamic process in which both parties must substantiate their assertions.
Evidence used by the insurer
Insurers use various types of evidence to prove fraud. Knowing these types of evidence helps you prepare your defence.
Expert reports The insurer regularly engages experts to assess the cause and extent of the damage. A fire expert can determine whether a fire was deliberately set or not, a motor vehicle expert can assess whether the damage fits the reported scenario and a structural expert can determine the extent of construction damage. The conclusions of these experts play an important role in the insurer’s evidentiary case.
Witness statements Statements from witnesses, neighbours, colleagues or other involved persons can be used by the insurer to contradict the damage report. Statements that the insured himself
has made during an interview with the insurer’s investigators can also serve as evidence, especially if those statements contain inconsistencies.
Technical and digital evidence
Insurers increasingly use technical and digital evidence. Think of CCTV footage, GPS data, phone data, bank statements and social media. If someone claims that their car was stolen while GPS data shows that the car was driven to a particular location, this forms strong evidence for the insurer.
Observations and private investigation
In some cases the insurer has the insured observed by an investigation agency. The results of observations may be used as evidence, provided the investigation was carried out in accordance with the Gedragscode Persoonlijk Onderzoek (Code of Conduct for Personal Investigation). Observations obtained in violation of this code may be regarded as unlawfully obtained evidence.
Challenging the insurer’s evidence
If the insurer adduces evidence of insurance fraud, you have several options to challenge that evidence.
Counter-expertise
You can engage your own expert to conduct a counter-expertise. If the counter-expert reaches different conclusions than the insurer’s expert, this weakens the insurer’s evidentiary position. A difference of opinion between experts can be sufficient to sow doubt about the correctness of the insurer’s conclusions.
Challenging reliability
You can challenge the reliability of the insurer’s evidence. If the expert report contains methodological defects, if witness statements are contradictory or if technical evidence was obtained improperly, you can raise this as a defence. An experienced lawyer can critically analyse the insurer’s evidentiary case and identify weak points.
Illegally obtained evidence
If the evidence was obtained unlawfully, for example through observations without reasonable suspicion of fraud or through a breach of privacy, you can argue that this evidence should be disregarded. The judge will then weigh whether the use of the evidence, despite its unlawful acquisition, is nevertheless justified in the circumstances.
The difference between civil and criminal evidence
It is important to know that the burden of proof in insurance fraud in civil proceedings operates differently from criminal proceedings. In criminal law the principle applies that fraud must be proven “beyond reasonable doubt”. In civil law the judge applies a lower standard of proof: the evidence must be sufficiently convincing, but absolute certainty is not required.
This means that an insurer in a civil procedure may sometimes succeed in proving its case where a criminal conviction would not be achievable.
Reversal of the burden of proof
In exceptional cases the court may decide to reverse the burden of proof. This means that it is not the insurer who must prove that fraud was committed, but the insured who must prove that no fraud was committed. Reversal of the burden of proof can occur if there are such strong indications of fraud that it would not be reasonable to require the insurer to provide further evidence. In practice reversal of the burden of proof in insurance fraud is uncommon and the court applies this measure with restraint.
The role of Kifid (Klachteninstituut Financiële Dienstverlening, the Dutch Financial Services Complaints Institute) in evidentiary disputes
The Klachteninstituut Financiële Dienstverlening plays an important role in disputes about the burden of proof in insurance fraud. You can go to Kifid if you disagree with the way the insurer collected evidence or the conclusions drawn from it. The disputes committee of Kifid assesses whether the insurer has presented sufficient evidence and whether that evidence was obtained lawfully. Kifid has ruled on the burden of proof in insurance fraud in numerous decisions and thus offers a valuable source of guidance for insureds accused of fraud. A Kifid procedure is generally more accessible and faster than going to court. In addition, the costs for the insured are limited. It is, however, advisable to seek legal assistance even in a Kifid procedure, because the evidentiary aspects of fraud cases require specialist knowledge. A lawyer can help you optimally substantiate your defence and expose weaknesses in the insurer’s evidentiary case.
Collecting evidence for your own defence
In addition to challenging the insurer’s evidence, it is important to actively collect evidence that supports your position. This may consist of witness statements from people who observed the damage event, photos or video footage documenting the damage, invoices and receipts demonstrating the value of damaged goods and medical reports in the case of personal injury. The better you build your own evidentiary position, the stronger your defence against the insurer’s fraud allegation. It is wise to start collecting and securing evidence at an early stage. Evidence can be lost over time: witnesses forget details, digital data is overwritten and physical evidence can disappear. By carefully documenting and preserving evidence immediately after the damage event, you significantly strengthen your position in case the insurer later initiates a fraud investigation.
State-subsidised legal aid
A dispute about the burden of proof in insurance fraud requires specialist legal knowledge. If your income is limited, you may be eligible for state-subsidised legal aid. The Raad voor Rechtsbijstand (Legal Aid Board) grants subsidies to people with a low income, so that the government pays the bulk of the lawyer’s costs. You then pay only a limited personal contribution. This makes expert legal assistance accessible even if you do not have a large budget.
Have your case assessed by a specialist
The burden of proof in insurance fraud is a complex legal topic that has a major impact on
the outcome of your dispute with the insurer. A specialised lawyer can assess whether the insurer has provided sufficient evidence for its fraud allegation, whether the evidence was obtained lawfully and which grounds of defence are most promising in your situation. Have you been accused of insurance fraud and want to know how strong the insurer’s evidentiary position is? Contact us for a no-obligation assessment. Our lawyers analyse the available evidence, evaluate your defences and advise you on the best strategy to secure your entitlement to payment.
Also read
- Insurer accuses you of fraud
- Fraud investigation by insurer: your rights
- Removing a CIS registration
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