Before long, there would be no car insurance industry and we’d all be paying for damages and injuries out of pocket.Lawsuits would inevitably skyrocket, clogging our already over-burdened court system.Backdating, by definition, is the practice of putting a calendar date on any document that is earlier than the date on which that document was actually written. Backdating Car Insurance Policies Backdating a car insurance policies is illegal and something no reputable insurance company or agent would ever do. Because it implies that you had coverage on your vehicle before you actuallydid. Let’s look at how backdating affects different aspects of car insurance, health insurance and life insurance.
Under most circumstances, backdating is seen as fraudulent and illegal, although there are some situations in which backdating can be used in a legal and beneficial way, such as backdating a claim for a past period.That promise is considered to be an in-the-money options grant.In-the-money options are different from performance-based compensation in the eyes of the Internal Revenue Service and the Financial Accounting Standards Board.The cascading litany of alleged charges is not likely to stop with the Brocade case.Indeed, with more than 80 companies being reviewed by the SEC for potential illegal backdating practices, and one academic study claiming that more than 2,000 companies have engaged in the practice, civil and criminal charges will probably mushroom in the next few months. The purpose of backdating is straightforward: it gives options holders an immediate paper gain, and a real gain once the option is exercised.