If you’ve never considered the impact of insurance fraud on society, consider the information below pulled from consumer watchdog group - the Coalition Against Insurance Fraud’s website.
Insurance fraud steals at least $80 billion every year. That's a lot of money... a lot of crime... and plenty of harm to honest Americans everywhere.
What does this big number really mean? Actually, quite a lot!
With $80 billion, you could buy...
- Thanksgiving dinners for 16 million festive gatherings of 10 guests every year - for the next century;
- New car or truck for 2.4 million drivers. That's new wheels for every driver in Oklahoma.
- 219,280 new homes - half of annual home buyers in the U.S.;
- Tickets and refreshments to 10 Major League baseball games for 3.8 million families of four. Or ... every family in Philadelphia and Phoenix. They get tickets, caps, programs, sodas, beer and hot-dogs - and parking. Mustard's free!
You also could...
- Fund global humanitarian aid for more than three years. This includes UN peacekeeping for nearly a decade;
- Compensate 1.8 million working Americans for a year;
- Fund incomes of every household in Los Angeles - plus some.
- Pay federal income taxes for 6.2 million Americans;
- Fund federal cancer research & training for the next 16 years;
- Pay 8.75 million in-state students one year of tuition to a four-year public undergrad university; and
- Pay salary of every high school teacher in the U.S. for two years.
Other $80 billion fraud facts...
Long walk: If you place 80 billion one-dollar bills end to end, they'll stretch to the moon and back - about 16 times; and…
Fraud, Inc.: If insurance crooks formed a company called Fraud, Inc., it would rank in the top 10 percent among the Fortune 500 in yearly revenue (35th overall).
With statistics like that – it’s understandable why states like Florida would enact legislation to reduce fraud and subsequently, reduce insurance rates.
One such piece of legislation was passed in 2012 to minimize fraudulent auto claims and to reduce sky-rocketing auto insurance rates. HB 119, a no-fault auto insurance reform bill, allowed policy holders to recover financial losses from their own insurance company, regardless of who was at fault for the accident.
The bill didn’t stop there in its efforts to minimize fraudulent behavior. It also required anyone injured during an accident to be examined by a physician, dentist or chiropractor within 14 days of the accident in order to seek recovery under their PIP coverage.
However, individual policy holders were not the only perpetrators of fraud in the system. Unscrupulous doctors and other medical professionals faced stronger penalties for fraud as a result of HB 119 and insurers under the new bill were allowed to extend the time for fraud investigations from 60 days to 90.
The bill also created standardized attorney fee structures.
The bill had a major impact on auto insurance rates and was successful in reducing statewide PIP rates by 13.6 percent over a 4-year time frame. However, even with HB 119 in place, Florida still ranks the second highest in auto insurance rates in the country. And it’s important to note that auto insurance is only one area Florida’s insurers face fraudulent claims in.
Property & casualty insurers have their fair share of fraud to contend with too. Recent charges against nine individuals in Miami-Dade County for allegedly perpetrating a string of false water damage claims and defrauding insurance companies out of more than $2.5 million dollars, illustrate what insurance companies are up against.
The overall impact and costs resulting from insurance fraud directly affect each and every resident in the state of Florida. Adopting a zero tolerance for fraudulent claims and partnering with an experienced investigative legal team can be an insurer’s secret weapon to combating fraud.
At Rubinton & Associates, we make it our mission to diligently investigate and analyze every aspect of a potentially fraudulent claim and use our diverse experience across multiple legal sectors and demographics, to bring every case to a successful conclusion for our clients. Contact us today to learn more about how to better protect your company from the devastating financial effects of fraudulent claims.