Is purchasing crop insurance and then destroying a crop fraud?

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Is purchasing crop insurance and then destroying a crop fraud?

My mother and my uncle co-own 48.5 acres of farmland. They have been renting it to my cousin (their nephew) who plants a crop. This year my Uncle have decided to sell the land and have informed my cousin verbally that he is not to plant a crop. He planted a crop anyway. After finding out that he may lose his crop, my cousin informed my uncle that he should buy crop insurance for his crop. I think he figures that if he had to destroy the crop, he would still get a payout. I certainly don’t think my uncle is obligated to buy such insurance. Plus, isn’t this considered insurance fraud?

Asked on June 18, 2012 under Criminal Law, Michigan

Answers:

Kevin Bessant / Law Office of Kevin Bessant & Associates

Answered 9 years ago | Contributor

This issue with fraud is whether or not you had an intent to defraud the insurance company by destroying the crop. The actual destruction of the crop is not an issue because he can do what he wishes to his own property, but if he were to file an insurance claim stating a loss of the crop for reasons other than his own personal destruction of it, then upon a finding that it was destroyed purposely by the holder of the policy 1) The insurance company is not obligated to pay 2) While unlikely, the insurance company could seek criminal charges due to your Uncle's intent to defraud the company.


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