Michigan’s auto insurance industry is looking to tackle the issue of fake medical claims relating to auto accidents and scams that involve the billing of insurance companies for procedures more expensive than those actually performed. There has been a recent increase in such questionable claims, and Michigan now ranks third in the nation in such claims. Even Gov. Rick Snyder is onboard, addressing both the issue of auto insurance fraud and no-fault insurance in general during his State of the State address last month.
The robust no-fault insurance provision can be a “magnet for unscrupulous and fraudulent claims activity,” says Meghan Cass, an Allstate Insurance spokeswoman. Under
no-fault law, it is required of motorists to purchase unlimited, lifetime
medical benefits. While the concept has worked well, it has resulted in steady
premium increases. Michigan
The proposed Fraud Authority would involve the ferreting out of what scams are taking place while providing financial support to law enforcement, prosecutors, and insurance associations. While insurers may have to dedicate up to $15 million per year towards such an authority; it would save millions more. It is estimated that 10% of all claims in
are fraudulent. The result: the opportunity to save at least $40 million per
The high fraud rate in
may be the
result of other states cracking down, driving con artists to find new stomping
grounds. While Florida and New York grew more stringent, questionable auto
insurance claims related to medical issues rose 70% in Michigan from 2010 to
If the issue of a fraud authority does not get too tied up in the more controversial debate over no-fault insurance in general, some say the creation of such an authority may stand a chance this year.
If you have questions about criminal matters, fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.
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