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NY Auto Insurance Fraud Summit

Auto insurance fraud has been an ongoing problem in the state of New York. Drivers in the state who abide by the laws and do not try to capitalize on the system face higher auto insurance premiums because of the abuse of the minority. New York is a no fault state, and no fault auto insurance fraud is one of the biggest reasons why New Yorkers pay some of the highest auto insurance premiums of anyone all across the country. Over the past five years or so, the rate of suspected no fault fraud has climbed steadily. Lawmakers and insurance industry leaders alike have called for action to try to curb the problem and help save NY drivers from paying too much for car insurance as a result of the actions of the criminals behind these fraudulent claims. Recently an auto insurance fraud summit convened to discuss the ongoing problem of no fault fraud and to discuss possible ways to combat fraud to help drivers in the state to save money on escalating insurance premiums.

Fraud Summit Hosted by NICB/NYIA

The fraud summit took place on April 21, 2010 in East Elmhurst, NY. It was hosted by the National Insurance Crime Bureau (NICB) and the New York Insurance Association (NYIA). The purpose of the gathering was to discuss the scope of the no fault auto insurance fraud problem in the state of New York, and its impact on policy holders, and to take a close look at potential solutions to the problem. Those in attendance included professionals in the insurance industry, law enforcement officials from around the state, elected political officials, insurance industry regulators, self insured individuals and business owners, and others interested in working on the issue of fraud prevention in the state. Topics covered in the no fault fraud summit included fraud, rate evasion, online policies, and insurance premium fraud. Representatives from law enforcement agencies and insurance industry officials were on hand to discuss the current legal situation governing no fault law and fraud in particular, and to recommend ways to strengthen efforts to curb the problem across the state [1].

The summit was packed, with every available seat occupied as speakers shared their thoughts on the growing and persistent problem, the impact it has had on New York auto insurance policy holders and ways they would recommend working to eradicate the issue and bring down the rate of fraudulent claims in NY. New York Insurance Superintendant James Wrynn, who has been at the center of the state government's efforts to combat the problem, and Queens County DA Richard Brown opened up the summit with their remarks. Each of the two men focused on the work their respective offices are doing to fight the ongoing problem to give some specific contextual basis for attendees to consider as the summit progressed [2].

Dominant Themes in Fraud Summit

From the remarks made by Wrynn, Brown, and other speakers, it is evident that those who are directly involved in the efforts to combat this ongoing and expensive issue have a lot in common in terms of their thought processes and perspectives on the issue. One theme that will hit home with policy holders is a financial one. Repeated throughout the day was the statement that if the no fault fraud issue is left unchecked, the state Insurance Department will have no choice but to approve substantial increases in auto insurance premiums across the board to help insurers meet ever increasing claims expenses and stay afloat. Of special concern was the area in and around New York City, where fraud has been the most rampant. From simple swoop and squat accidents to intricate networks involving collision shops, doctors, and other participants, NYC has been a breeding ground for incredibly high rates of fraud.

Certain speakers also pointed to specific court decisions in the state judicial system, which have hamstrung insurance companies' capability to identify and fight against fraudulent claims. In recent years, courts have been flooded with no fault claim civil suits, most of which have been for financial amounts smaller than the average civil suit, and these suits have been extremely successful on average, costing the typical policy holder in the way of higher rates and creating an incentive for fraud at the same time [2].

Speakers were united in their opinions that the upward trend of no fault NY insurance fraud will continue unimpeded and perhaps even increase unless the state goes forward with comprehensive changes in the way the laws are written and administered. The goal of auto insurance and insurance law should be that legitimate claimants are protected and health care providers paid promptly while would be criminals are identified and rooted out. The summit demonstrated common interests across different state industries.

[1] https://www.nicb.org/events/industry_events/new-york-insurance-fraud-summit Retrieved 2010-05-23.
[2] http://nycoveragecounsel.blogspot.com/2010/04/nicbnyia-insurance-fraud-summit.html Retrieved 2010-05-17.

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