Do businesses ever commit insurance fraud?

You bet your sweet bippie they do.

A large warehouse on the outskirts of NYC burns to the ground. All of the contents are declared a total loss. (Fraud: The owner wanted to get rid of a lot of outdated merchandise.)

An inland Mississippi warehouse flooded during hurricane Katrina. Nothing could be saved.
(Fraud: Purely opportunist. It was a great chance to retire at a time when nobody was likely to be buying Fine Arts anyway.)

A California construction company reports to its worker's compensation carrier that 90% of its employees are clerical and 10% are doing construction. (Fraud: By not accurately reporting, they saved $640,000 in workers' compensation insurance premiums and were able to under quote all of the honest competition.)

A semi-tractor trailer loaded with computer equipment is hijacked. When the vehicle is recovered, the trailer is empty and the tractor is burned. (Fraud. The tractor had engine troubles and the owner owed more than it was worth. The load of computer equipment was his intended bonus to himself.)

What happens when a business commits fraud?

The same thing that happens when a plain old ordinary person commits insurance fraud. The rates increase for everyone. When rates increase, prices increase. When prices increase, WE all pay the cost. Also, honest business owners can be adversely affected.