Matthew Worley, Esq.
Michigan Secretary of State Ruth Johnson, in coordination with police, prosecutors, state officials, and industry leaders has launched a new anti-fraud task force. Fighting Auto Insurance Rip-offs, referred to simply as FAIR, is aimed at combatting a growing trend in Michigan – auto insurance fraud.
The scam involves individuals selling fake auto insurance policies. The perpetrators then set up fake help desks so when a call is made to verify a policy, a real person answers and vouches for the non-existent policy. However, as soon as the motorist is in an accident or tries to make a claim, they realize that there is no policy and their premiums having been lining someone’s pocket.
In July, Secretary of State Johnson’s office conducted a one-day review of the 15,000 registration renewals submitted in all the branches. Of the insurance policies verified that day, an astonishing 16% were found to be invalid or fraudulent. These fakes turned up in more than half of Michigan’s 83 counties.
The burden of these uninsured motorists is felt by every law-abiding Michigan motorist who follows the law and carries a no-fault policy. The costs of having these uninsured motorists on the road rise into the hundreds of millions of dollars – which translates to higher insurance premiums.
The FAIR task force will explore new means to combat insurance fraud through procedural changes, new investigative efforts, and potentially new legislation. It will include representatives from the Secretary of State’s office, the Michigan State Police, Michigan prosecutors, and several insurance industry organizations.
If you have questions about auto insurance fraud, or any other legal matters, contact the experts at Fausone Bohn, LLP at (248) 380-0000 or online at www.fb-firm.com.
To learn more about the new fraud task force, visit: http://www.insurancejournal.com/news/midwest/2013/09/19/305718.htm.