What does fraud in insurance primarily involve?

Fraud in insurance primarily involves misrepresentation of facts for financial gain. This type of fraud occurs when an individual or entity provides false information or conceals important facts in order to obtain benefits that they are not entitled to. For instance, this could mean inflating a claim, providing false information when purchasing a policy, or failing to disclose pertinent personal information that would affect eligibility or premiums. This deception undermines the integrity of the insurance system, leading to inflated costs and risks for insurers and policyholders alike.

The other options pertain to various administrative issues within the insurance context but do not encapsulate the essence of fraud. Unauthorized sharing of personal information relates to privacy violations rather than fraud itself. Failure to submit required documents and not maintaining proper records are issues of compliance and operational procedure rather than fraudulent activities that involve deceit for financial benefit. Thus, the focus on misrepresentation emphasizes the intentional and deceptive nature of insurance fraud, making it the most accurate response.