A person holds a diamond in a set of tweezers (Photo: Stellarit/Shutterstock.com)

Picture this: A person walks into an agent's office wearing a luxury watch that belongs to a friend, appraisal in hand, and walks out with a personal articles policy after paying a premium of just 1 to 2% of the value of the watch. Three months later, they submit a claim alleging that the watch was lost while swimming in the ocean, or stolen in a robbery or missing after the house was cleaned. With little investment and, unfortunately, very little risk of criminal penalty, this person can quickly make a profit of tens of thousands of dollars or more.

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