STRICTER REQUIREMENTS FOR REPORTING INSURANCE FRAUD
Tom Gallagher, Florida’s chief financial officer, announced that department rules outlining stricter requirements for insurance companies to report insurance fraud will soon be in place. In the wake of multiple hurricanes, Gallagher directed the Department of Financial Services’ Division of Insurance Fraud (DIF) to tighten reporting requirements and enhance penalties for failure to report insurance fraud.
“Insurance fraud forces Florida families to pay more in premiums than necessary,” Gallagher said. “With explicit rules and stiff fines in place, there will be no excuses for failing to report fraud.”
Florida law requires insurance companies to report insurance fraud but does not provide clear guidance for when and what to report when an insurance claim is considered suspicious.
Under the rules Gallagher is promulgating, insurance companies would be required to:
Gallagher is also pushing for legislation in the upcoming legislative session to fine insurance companies up to $50,000 for failing to implement insurance fraud plans and timely report fraud.
The rule will be considered at a public hearing next month.
To date, DIF has opened more than 120 investigations of hurricane-related fraud. More than 30 suspects have been arrested for insurance fraud following the 2004 hurricanes, and eight have been convicted.
In the last five years, Florida has led the nation in insurance fraud arrests and convictions, according to the Coalition Against Insurance Fraud.
“We need to continue aggressively rooting out fraud that financially impacts Florida’s families,” Gallagher said.