Which situation is identified as a fraud indicator regarding a homeowner's and auto policy?

The situation where a loss occurred during the first policy year is recognized as a fraud indicator because it can often suggest that the claim may be strategically timed. Fraudulent claims can sometimes be filed soon after a policy is enacted, as individuals may believe that they can exploit the insurance coverage before any significant premiums have been paid. This behavior raises red flags for insurers, as it is relatively common for dishonest individuals to use this strategy when trying to commit fraud.

In contrast, claims filed after a policy has been active for a longer period, like those in the second year or beyond, are typically perceived as less suspicious because they align more closely with the expected timeframes for genuine claims. An auto policy being active for several months or the order in which policies were filed usually do not serve as strong indicators of fraud, as these scenarios fall within normal patterns of insurance usage.