Questionable Insurance Claims on the Rise
The Insurance Journal is reporting today that suspicious property and casualty insurance claims rose again in the first half of 2010, as compared to the first half of 2009.
The Journal cited a recent QU (questionable claims) report released by the National Insurance Crime Bureau, which examined six categories of referral reasons for claims: property, casualty, commercial, workers’ compensation, vehicle, and miscellaneous. Overall QCs increased by 14% in four of those categories in 2010, as opposed to 2009. These are claims which are referred to the bureau by member insurance companies that feel closer examination and examination is necessary because of indicators of possible fraud. A single claim can contain up to seven referral reasons.
This year saw a 107% increase in questionable hail damage claims and a 527% increase in questionable auto glass claims. Specifically, the bureau’s report notes: “Hail loss claims and QCs are generally concentrated in the central section of the U.S. However, seven of the top 10 states with the highest hail loss QC-to-claim ratio are not in the central section. This suggests that fraudulent hail losses can occur in any part of the country.”
Joe Wehrle, NICB’s president and CEO adds, “While there have been modest declines within a few categories of referrals, the 14 percent increase in the overall number of questionable claims for 2010 raises concerns.”
According to Wehrle, NICB, along with member insurers and law enforcement agencies have pursued unscrupulous roofing companies that take advantage of storms to fake or deliberately cause damage to roofs in an effort to get insurers to pay for a replacement roof that wasn’t damaged by a storm. Also under pressure from law enforcement, insurance companies and the NICB are staged accident rings, which are found in various regions including Tampa, FL, where this has become a major problem.
“We’re seeing concern from our members about criminal rings that are deliberately damaging vehicle windshields in order to file an insurance claim, and in some cases are not doing satisfactory repairs or replacements,” Wehrle said.
NICB is supported by nearly 1,100 property and casualty insurance companies and self-insured organizations.