The study of engaging in fraudulence mostly focuses in the field of accounting and auditing. On the other hand, the papers of fraud behaviour has been rarely published and studied in this field. This paper explores and discusses the negative impact and influences of cheating behaviour by qualitative method and examines the possible control mechanism to prevent the chances of fraudulences. The results of this paper show that most fraud cases in insurance industry incurred by personal internal misconducts and the incomplete mechanism of management system. The answer released the message that reward is the key element to fraud behaviour without any consideration of consequence. The executives of sales Dept. prefer the co-punishment as the useful mean to stop such behaviour while most salesmen don’t agree it. Therefore, Insurance companies should strengthen the selection and training program for salesmen and design the effective control system including co-punishment and auditing mechanism.