INDIANAPOLIS (May 25, 2005)—To combat insurance fraud that costs consumers an average of $200-300 per year, 40 states have established entities responsible for oversight of related investigations and prosecution efforts, according to an analysis by the National Association of Mutual Insurance Companies (NAMIC).
NAMIC’s just released Issue Brief “Insurance Fraud: Most States Act to Curb the Abuses, But Adequate Statutory Remedies Still Lacking in a Few States:”
The brief highlights the creation of CAIF in 1993 as an important step in the fight against insurance fraud. CAIF has developed a set of model law elements it considers important for states to adopt in order to effectively combat and deter insurance fraud. These include laws to:
A majority of states have taken action to adopt most or some of these key legal provisions. NAMIC’s analysis of state laws pertaining to insurance fraud identifies just nine states– Alabama, Georgia, Mississippi, Missouri, North Dakota, Oregon, Vermont, West Virginia, and Wyoming—that have approved three or fewer of the provisions advocated by the CAIF.
At least 17 states so far this year have introduced legislation to combat insurance fraud. Bills introduced in Missouri, Maine and West Virginia would establish important new anti-insurance fraud elements.
Other key findings include:
Fraud bureau budget, employment, prosecution and conviction data are presented in an appendix. A second appendix lists which states have enacted which of the CAIF model law provisions.
The Issue Brief will be distributed to NAMIC’s multi-line member companies, state legislators, and insurance regulators to provide them an insight into a state’s regulatory climate.
The Issue Brief can be downloaded from NAMIC’s website, NAMIC Online.