An operator in Manila filed an insurance claim for $8,500 in lost revenue from cheating over a four-month period. The insurance adjuster called him two weeks later with a list of questions that made it clear the adjuster didn’t understand how arcade cheating works. “How do you know the money was stolen and not just miscounted?” “Can you prove a specific person took the money?” “Why didn’t your security cameras catch the thief?” The operator had good records but didn’t know how to present them in a way that answered the adjuster’s questions. His claim was eventually approved, but only after three months of back-and-forth and a reduced payout.
Proving revenue loss from cheating to an insurance adjuster requires a different approach than proving theft to a police officer or a business partner. Insurance adjusters are trained to look for evidence of physical theft — a broken window, a missing item, a security camera showing the crime. Arcade cheating leaves no physical evidence. The theft is invisible, technical, and statistical. You need to present your evidence in a way that makes the invisible visible to someone who doesn’t understand gaming technology.
How Insurance Adjusters Think About Gaming Theft
Insurance adjusters categorize losses into buckets: physical theft, employee theft, operational error, and fraud. Arcade cheating doesn’t fit neatly into any of these categories, which is why adjusters struggle with it. Your job is to frame the loss in terms the adjuster understands.
Physical theft is the easiest category for adjusters. Someone breaks in, takes something, and leaves. There’s a police report, security footage, and a missing item. Arcade cheating isn’t physical theft — nothing is missing from the premises. But you can frame it as “theft by electronic manipulation” if you can show that someone used a device to alter the machine’s behavior and extract value.
Employee theft is what adjusters first suspect when they see revenue shortfalls. “Maybe your staff is skimming cash.” You need to rule this out with evidence. Show that your cash handling procedures are secure (dual-person counts, sealed bags, video verification). Show that the revenue loss correlates with specific player activity, not specific staff shifts. If the loss happens on all shifts and all days, it’s not employee theft.
Operational error is the adjuster’s default explanation. “Maybe your machines are malfunctioning.” You need technical evidence that the machines were working correctly. Provide maintenance records showing recent service. Show that the machines passed self-diagnostics. If possible, provide a technician’s report stating that the machines were mechanically and electronically sound during the claim period.
Fraud is the category that most closely matches arcade cheating. Someone deliberately deceived the machine to extract value. The problem is that insurance adjusters are trained to think of fraud as something the policyholder commits (fraudulent claims), not something that happens to the policyholder (fraud against the business). You need to reframe the conversation: “This is third-party fraud — someone used a device to defraud my business, and I have evidence of how they did it.”
Building Your Evidence Package
The key to a successful claim is presenting a complete, coherent evidence package that tells a clear story. Here’s what to include.
Section 1: The baseline. Show your revenue history for 6-12 months before the theft period. This establishes what “normal” looks like. Use a simple line graph showing monthly revenue per machine. If your revenue was stable or growing before the theft, the adjuster can see that the decline was an anomaly, not a trend. One operator I worked with showed 8 months of stable revenue at $19,000-20,000/month, followed by a sharp drop to $15,000-16,000/month during the theft period. The visual contrast was compelling.
Section 2: The anomaly. Document the specific period when you noticed the revenue loss. Include daily or weekly revenue data showing the decline. Calculate the total loss: baseline revenue minus actual revenue during the theft period. Be precise — “We lost $8,472 over 16 weeks” is more credible than “We lost about $8,000.” Show the math: baseline of $4,850/week x 16 weeks = $77,600 expected. Actual revenue: $69,128. Loss: $8,472.
Section 3: The technical evidence. This is where you prove the loss was caused by cheating, not operational error. Include credit-to-cash variance data showing that the machines were dispensing more credits than cash collected. If you have signal analysis data showing Bluetooth relay activity or voltage injection, include it. If you confiscated a cheat device, include photos and a description. If a technician analyzed the attack, include their report. The goal is to show that a specific, identifiable cheat method was used against specific machines.
Section 4: The correlation. Show that the revenue loss correlates with the presence of specific players or the use of specific cheat methods. If you have player tracking data, show that the loss occurred primarily when certain players were present. If you installed anti-cheat hardware and the loss stopped, show the before-and-after comparison. One operator showed that his revenue loss dropped from 12% to 1.5% within 10 days of installing anti-cheat modules. The adjuster accepted this as proof that the loss was caused by a specific, addressable vulnerability.
Section 5: The recovery. Show what you did to stop the cheating and prevent future losses. Document the anti-cheat hardware installation, staff training, or procedural changes you implemented. This demonstrates that you’re a responsible operator who takes security seriously — not someone trying to profit from a recurring problem. Insurance companies are more likely to pay claims from operators who show they’re preventing future losses.
Presenting Technical Evidence to Non-Technical Adjusters
The biggest challenge is explaining technical concepts to someone who doesn’t understand gaming technology. Here’s how to do it effectively.
Use analogies, not jargon. Don’t say “The cheater used a Bluetooth relay to intercept the RS-485 communication between the main board and the I/O controller, injecting modified payout commands.” Say “The cheater used a wireless device to listen to the conversation between the game computer and the payout system, then sent fake messages telling the machine to pay out more than it should.” The adjuster doesn’t need to understand RS-485 — they need to understand that someone used a device to trick the machine.
Use visuals. A simple diagram showing how the cheat device connects to the machine is worth more than a page of technical description. Show the machine, show the cheat device, and show the communication path with arrows. If you have photos of the cheat device, include them. Visual evidence is more compelling than text, especially for non-technical audiences.
Quantify everything. Adjusters work with numbers. “The cheater stole money” is vague. “Machine #7 showed 18% credit variance over 8 weeks, resulting in $2,400 in unaccounted revenue” is specific. “We recovered $6,800 in monthly revenue after installing protection” is powerful. Every claim should be backed by numbers.
Get a technical expert to write a summary. If you have a technician or anti-cheat vendor who can write a one-page summary explaining the attack method in plain English, include it. An expert’s opinion carries weight with adjusters. One operator included a letter from his anti-cheat vendor explaining the Bluetooth relay attack and how the vendor’s module prevented it. The adjuster cited this letter as key evidence in approving the claim.
Frequently Asked Questions
Q: What if I don’t have technical evidence of the cheat method?
You can still file a claim, but it’s harder to prove. Focus on the statistical evidence: credit-to-cash variance, revenue decline, and recovery after security measures. Even without knowing the exact cheat method, you can show that a specific machine or group of machines was losing revenue at an abnormal rate, and that the loss stopped after you implemented security measures. This isn’t as strong as having technical evidence, but it’s still a valid claim.
Q: Should I mention that I didn’t have anti-cheat protection before the theft?
Be honest but strategic. If the adjuster asks, answer truthfully. But don’t volunteer it as a leading point. Frame it as “We didn’t have protection because we didn’t know this type of attack was possible. As soon as we discovered the problem, we implemented professional-grade protection.” This shows responsiveness, not negligence. Some insurance policies have “reasonable precautions” clauses — if you can show that you took reasonable steps to protect your business (even if they weren’t sufficient), you’re in a better position than if you took no steps at all.
Q: Can I claim for the cost of anti-cheat hardware as part of the theft claim?
Sometimes. Some policies cover “loss mitigation expenses” — costs incurred to prevent further losses after a covered event. If your policy includes this coverage, you can claim the cost of anti-cheat hardware installed after the theft. Check your policy language for “loss mitigation,” “preventive measures,” or “reasonable expenses to prevent further loss.” Even if your policy doesn’t explicitly cover this, include the hardware cost in your claim and let the adjuster decide. The worst they can do is exclude it.
Q: What if the insurance company denies my claim?
Request a detailed written explanation of the denial. Insurance companies are required to provide specific reasons for claim denials. Review the denial letter carefully — sometimes the denial is based on a misunderstanding of the facts or a misinterpretation of the policy. If you believe the denial is incorrect, file an appeal with additional evidence. Most insurance companies have an internal appeals process. If the internal appeal is denied, you can escalate to your state’s insurance regulator or hire an attorney who specializes in insurance claims. For claims over $10,000, legal representation is often worth the cost.
What to Do Next
If you’re preparing an insurance claim, start by organizing your evidence into the five sections I’ve described. Create a timeline showing your revenue baseline, the anomaly period, the technical evidence, the correlation data, and your recovery actions. Use simple language and visual aids. If you have a technician or anti-cheat vendor who can provide an expert summary, ask them to write it. The adjuster’s job is to verify your claim — make their job easy by presenting clear, organized, compelling evidence. The operators who get their claims approved quickly are the ones who treat the claim like a business presentation, not a casual conversation.