Insurance Fraud Nebraska Department of Insurance Nebraska gov

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					WHAT IS INSURANCE FRAUD?                         Examples include:                                     Internal frauds are those perpetrated
                                                                                                       against a company or its policyholders by
Insurance fraud is any deliberate deception      CREATING A FRAUDULENT CLAIM:                          agents, managers, executives, or other
committed against or by an insurance                                                                   employees. Examples include:
company, insurance agent, or consumer for        ♦   Staged or caused auto accidents
                                                 ♦   Staged slip and fall accidents
the purpose of unjustified financial gain.                                                             ♦ Agent or insurer pocketing premiums,
                                                 ♦   False claim of foreign object in food or drink
This occurs during the process of buying,                                                                then issuing a phony policy or none at all
                                                 ♦   Faking a death to collect benefits, or filing a
using, selling and underwriting insurance.           phony death claim                                 ♦ Agent or insurer issuing fake policies,
                                                 ♦   Murder-for-profit                                   certificates, ID cards or binders
Fact: Insurance fraud is the second largest      ♦   Phony burglary, theft or vandalism                ♦ Agent or insurer making a false
economic crime in America, exceeded only         ♦   Arson                                               statement on a filing with the Nebraska
by tax evasion.                                  ♦   Staged auto thefts                                  Department of Insurance
                                                 ♦   Staged homeowner accident or burglary
                                                                                                       HOW DO YOU PROTECT YOURSELF?
Ultimately, you pay the price for insurance      ♦   Inflating bodily injuries from an auto accident       Before purchasing insurance, contact
                                                                                                           your state insurance department to make
fraud. Insurance companies, policyholders,       ♦   Inflating value of items taken during a
                                                                                                           sure the insurance company and agent are
taxpayers and the general public pick up the         burglary or theft
                                                                                                           licensed and in good standing in your state.
tab through increased insurance rates,           ♦   Inflating a physical damage claim from a
higher taxes and inflated prices for                 minor fender bender                                   Never pay premiums in cash. Always
consumer goods and services.                     ♦   Medical providers inflating billing or                pay for premiums by check or money order.
                                                     upcoding of medical procedures                        Make your payment to the insurance
                                                                                                           company instead of the agent.
Fact: Insurance fraud costs each                 MISREPRESENTING FACTS TO RECEIVE PAYMENT:
American family nearly $1,000 a year.                                                                      Make sure you receive a written policy
These are direct costs that raise the price of                                                             within 60 days after payment of your first
                                                 ♦   Claiming prior damage occurred in the                 premium. This ensures the agent forwarded
health insurance premiums, auto and                  current accident                                      the premium to the company.
homeowners' premiums, and increases the          ♦   Claiming a minor injury created a partial or
price you pay for goods and services.                total disability                                      Immediately examine your policy to
                                                 ♦   Receiving disability payments while working           ensure you are getting the coverage you
                                                     elsewhere conducting same or similar work
WHAT      ARE THE DIFFERENT TYPES                    duties
                                                                                                           discussed with your agent.

OF FRAUD?                                        ♦   Medical providers billing for services not            Do not sign blank application or claim
                                                     rendered                                              forms.
Insurance fraud falls primarily into two         ♦   Claiming false disability                             Be suspicious if the price of insurance is
                                                 ♦   Providing unnecessary medical treatment               substantially   below   rates   from   other
categories: external and internal fraud.
                                                 ♦   Charging for non-provided medical tests               companies.
                                                 ♦   Pharmacist “upcoding” for medicine by
External fraud schemes are directed                                                                        Protect your insurance identification
                                                     issuing generic pills and charging for name
against a company by individuals or entities         brands                                                numbers as you would a credit card
as diverse as policyholders, medical                                                                       number.
providers,      beneficiaries,     vendors,
chiropractors, and career criminals.
         MISSION STATEMENT                            INSURANCE FRAUD IS A CRIME
The mission of the Insurance Fraud
Prevention Division is to confront the
problem of insurance fraud by prevention,
                                                  Neb.Rev.Stat. §§44-6601 to 44-6608; and
investigation, and prosecution of fraudulent
insurance acts in an effort to reduce the
amount of premium dollars used to pay             REMEDIES
fraudulent claims.                                CIVIL:

                                                  Civil fines of $5,000 for the first violation, $10,000
                                                  for the second, and $15,000 for each subsequent           A CRIME FOR WHICH
Absent malice or bad faith, immunity from
                                                                                                               WE ALL PAY
civil liability applies to any person or entity
who furnishes any information relating to         Class III Felony - Amount involved $1,500 or more
suspected fraudulent insurance acts. Also,        (20 years imprisonment and/or $25,000 fine)
the act provides insurer to insurer               Class IV Felony - Amount involved $500 or more           A Consumer Guide To Insurance Fraud
immunity regarding the exchange of                but less than $1,500 (5 years imprisonment and/or
information between those persons whose           $10,000 fine)
activities include the investigation or           Class I Misdemeanor - Amount involved $200 or
reporting of suspected insurance fraud.           more but less than $500 (1 year imprisonment and/
                                                  or $1,000 fine)
                                                  Class II Misdemeanor - Amount involved less
 INSURANCE FRAUD PREVENTION                       than $200 (6 months imprisonment and/or $1,000
The Insurance Fraud Prevention Division
is authorized to investigate and prosecute        Charles P. Starr, Division Chief
all lines of insurance fraud perpetrated by       402-471-8334 E-mail:
the insurer, agent, insureds or any other
                                                  Mark A. Wolfe, Insurance Fraud Investigator
individuals.    To report insurance fraud
                                                  402-471-8333 E-mail:
                                                  Michael L. Engel, Insurance Fraud Investigator
Nebraska Department of Insurance                  402-471-4999 E-mail:
Insurance Fraud Prevention Division
941 O Street, Suite 400                           Connie C. Drake, Administrative Assistant
Lincoln, NE 68508-3639                            402-471-8336 E-mail:                Nebraska Department of Insurance
                                                                                                               Insurance Fraud Prevention Division
Facsimile: 402-471-8335                                                                                             941 “O” Street, Suite 400
E-mail:                                                                             Lincoln, NE 68508-3639
Web site:
                                                                                               OUT00119                                        Rev. 1/10

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