More eyes needed on insurance fraud, including consumers’
It’s a fact that Florida’s no-fault auto insurance system is flush with fraud. Recently, the Florida Agency for Health Care Administration validated that with a three-day sweep of pain clinics in Miami-Dade County and found regulatory violations in 90 percent of them. In one documented case, an insurance company providing personal injury protection coverage was charged $19,000 for massage therapy. That accident “victim” must have had one heck of a pain in the neck. And, all drivers are paying the bill.
The costs of auto insurance fraud are causing lawmakers to consider bills to tackle the auto insurance fraud problem. But there is fraud in other insurance lines, too. The U.S. Office of the Inspector General has a Top 10 Most Wanted list for health care fraud. Three of the 10 names on the list are Florida fugitives. There is also workers’ compensation fraud, with schemes ranging from fake injuries to stolen identities to shell companies and everything in between. Then, there is property insurance fraud, with wording in state law that sometimes causes a cracked tile claim to fraudulently morph into a major remodeling project.
I just attended a meeting of the Property Insurance Fraud Task Force, organized by the state’s Division of Insurance Fraud, to address the perception that insurance fraud is a victimless crime. In truth, it’s a crime we all pay for through higher rates. Why? Because insurance rates are costs, and if the costs of claims keep rising, so do premiums.
Insurers care about fighting fraud and devote personnel to investigating claims – and state law requires it. The Property Insurance Fraud Task Force has a slogan: “Stomp Out Fraud.” As a member of this task force, I thought one way to do the stomping is to tell stories on what fraud looks like. Here’s one: A public adjuster in Miami submitted paperwork to an insurance company to pay $2.5 million to replace all the roofs on buildings at a country club. The claim was submitted in March 2010 for damage allegedly associated with Hurricane Wilma (yeah, that happened in 2005). This public adjuster said the original roof tile was no longer available, so all the roofs of all the country club buildings needed to be retiled so they matched. Public adjusters, by the way, get paid a percentage of the claim, so getting all the roofs retiled was a nicer payday than just one building. Result: After a state investigation, he was charged with grand theft in the first degree and insurance fraud. You can get the rest of the story to understand how fraudsters pick your pocket.
The story is true. And, I’m telling it to make you stomping mad. If you see insurance fraud, you can report it to the Division of Insurance Fraud or report it to the National Insurance Crime Bureau.