What are the laws governing insurance fraud and how can it be reported?

Insurance fraud is a serious crime that not only harms insurance companies, but also increases the cost of insurance for consumers. Insurance fraud can take many forms, including:

1. Policyholder fraud: this occurs when a policyholder provides false or misleading information to an insurance company in order to obtain a policy or to receive a larger benefit.

2. Provider fraud: this occurs when a healthcare provider bills an insurance company for services that were not rendered or for services that were not medically necessary.

3. Premium diversion: this occurs when an insurance agent or broker diverts premium payments for their personal use instead of remitting them to the insurance company.

4. Staged accident or inflated claims: this occurs when an individual stages an accident or causes an accident and then files an inflated claim.

5. Worker’s compensation fraud: this occurs when an employee exaggerates or falsifies an injury to receive worker’s compensation benefits.

All the above forms of fraud are illegal and are punishable by fines, imprisonment and even civil penalties.

To report insurance fraud, you can:

1. Contact the insurance company: Many insurance companies have fraud units that investigate suspicious claims. You can contact the company and report your suspicions.

2. Contact your state insurance commissioner: Each state has an insurance commissioner who is responsible for enforcing insurance laws and regulations. You can file a complaint with the commissioner’s office.

3. Contact the National Insurance Crime Bureau (NICB): The NICB is a non-profit organization that investigates insurance fraud. You can report suspected fraud to the NICB.

4. Contact the Federal Bureau of Investigation (FBI): The FBI investigates major frauds, including insurance fraud.

It’s worth noting that reporting insurance fraud is important, as it helps combat the problem and keep insurance costs down for all policyholders. Additionally, reporting fraud can also help protect yourself if someone else is committing fraud using your name or identity.