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July 10, 2014

Driver beware-Insurance fraud runs rampant

Mayo — Lance Braswell from Farm Bureau Insurance recently shed some light on what has been going on in the insurance industry, focusing mainly on insurance fraud.

Fraudulent auto claims

Braswell related a story of a client who had a minor “bump” vehicle accident while in line at a Central Florida theme park. The driver in the car that got bumped, looked at the bumper and saw no damage and stated he had no injuries and the client thought that was the end of it. Neither party called law enforcement at the scene to report the incident, which Braswell said is a no-no, although his client did exchange information with the other driver.

The next thing that happened was that Braswell got a letter from the other party’s attorney asking for policy limits; no letter stating how much in damages or injuries, just wanting to know policy limits.

Farm Bureau ran a check on the other driver and discovered he had a lot of personal injury protection (PIP) claims on his record.

“Whenever they see multiple PIP claims they get suspicious, so they did some more investigating,” he said.

It turned out that driver had 10 different auto policies on his vehicle and was trying to collect the $10,000 PIP amount from all of those insurance companies.

“He wanted $100,000 from our insured,” Braswell said.

It was learned that the driver, his attorney and his doctors were using the insurance monies received to fund terrorism, Braswell said.

“If you are in a fender bender with someone else, have a deputy or a state trooper write it up,” he said. “Don’t worry about the ticket. It can come back to haunt you.”

At the least, he said, fill out a driver exchange form so that you have the name of the person and their vehicle tag number.

“Ask the question, ‘Are you hurt?’ and make notes,” said Braswell.

He related another incident that showed how valuable it is to have law enforcement called to the scene of any auto accident. Shopping malls, he said, are a prime spot for auto accidents, and most insurance companies believe it is a 50/50 deal because there is no way to prove who was at fault.  A woman in an expensive SUV, he said, was backing out of a parking spot at a Valdosta mall and grazed the back fender of another vehicle. There was one man in the vehicle who stated there were no injuries when a Valdosta policeman came to write up the incident.

A little later the woman’s insurance company gets a letter that not only was the driver of the other vehicle hurt, but so were four other passengers in the vehicle. When it came to time to settle the claim, the police officer and the woman both stated there was only one person in the other vehicle. The insurance companies were still fighting over the claim a year-and-a-half later.

Braswell said he’d like to see a clampdown on the doctors who are willing participants in these type scams. He also urges everyone to make sure they have ample auto insurance coverage so that they are covered in these such instances.

Shopping malls are especially prime locations for insurance fraud, as people are sitting around waiting for the perfect victim to cash in on, Braswell said, and he urged people to drive carefully through mall parking lots. Also, be on the lookout for pedestrians, he added, because if you hit one it is hard to fight in court.

“Even if they’re not hurt, it’s hard to win,” he said.

Homeowner’s insurance fraud

Another scam is homeowners adding high dollar items onto their policy, such as an expensive ring or watch, and then a few months later they put in a claim with their insurance company that the item was lost or stolen.

One such individual forged an appraisal of a piece of jewelry by adding a few more zeroes, which was discovered after investigators paid a visit to the person who wrote the original appraisal. Also, the picture that the insurance agent had in the file was one out of a magazine and not a photo of the actual item.

Another incident involved an arrogant multi-millionaire in Miami who owned a multi-million-dollar vacation home in the Florida Keys. The man reported a theft of over 400 items out of the home and he had receipts for every one of the items.

An insurance adjuster went to each of the stores where the items were bought and asked for their receipt copies. He discovered that all of the receipts the man had of the 400 items were forged.

A note about Marketplace Insurance

The Affordable Care Act (ACA) continues to be a challenge for those attempting to sign up.

Braswell said, “They built this thing to get everybody enrolled. They knew they were going to have people with life and income changes (marriage, divorce, etc.). We’ve had two already that had a change in circumstance. So, we called in and the people actually told me, “The system’s not really built for this yet.””

Braswell said he spoke to someone higher up and was told they would work on it. Two weeks later, he was still waiting for an answer. Meanwhile, his clients were both looking at a big decrease in premium due to their change in circumstance. When Braswell called again, he was told it would need to go to yet another higher up to resolve.

“Forty-five days later and two simple changes aren’t done,” said Braswell. “I think their main focus was to try to get people enrolled and worry about the rest later. The later is here and they’re not ready for it.”

Fraud hotline

The state of Florida has several insurance fraud hotlines depending on the type of fraud, so if you are aware of insurance fraud going on, please make the call or find the specific agency on the web. It’s anonymous, Braswell said. Insurance fraud, he added, costs the industry a ton of money every year and the public winds up paying for it in their premiums.

“What gets me is it’s always the ones who pay and do the right thing that have to pay for all that insurance fraud,” said Braswell.

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