NICB Reports 14 Percent Rise in First Half 2010 Questionable Claims

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Aug 02, 2010, 09:00 ET

Hail Damage, Auto Glass and Staged Accidents Raise Suspicions

DES PLAINES, Ill., Aug. 2 /PRNewswire-USNewswire/ -- The National Insurance Crime Bureau today released its first half 2010 questionable claims (QC) referral reason analysis. The report examines six referral reason categories of claims—property, casualty, commercial, workers' compensation, vehicle and miscellaneous.

Overall there was a 14 percent increase in QCs in four of the six categories in 2010 when compared to the first half of 2009. These are claims that NICB member insurance companies refer to NICB for closer review and investigation based on one or more indicators of possible fraud. A single claim may contain up to seven referral reasons.

The full report is available at: https://www.nicb.org//File%20Library/Marketing/1st_Half_2010_QC_Analysis.pdf

Of note were the 107 percent increase in questionable hail damage claims and 527 percent increase in questionable auto glass claims so far this year when compared to the first half of 2009. Today's release reflects findings previously published in a NICB ForeCAST(SM)report of hail loss claims. Among the conclusions of the previous report: "Hail loss claims and QCs are generally concentrated in the central section of the U.S. However, seven of the top 10 states with the highest hail loss QC-to-claim ratio are not in the central section. This suggests that fraudulent hail losses can occur in any part of the country."

"While there have been modest declines within a few categories of referrals, the 14 percent increase in the overall number of questionable claims for 2010 raises concerns," said Joe Wehrle, NICB's president and chief executive officer.

"We've been actively involved with our members and law enforcement in pursuing suspected unscrupulous roofing companies that take advantage of storms to fake or deliberately cause damage to roofs in an effort to get insurers to pay for a replacement roof that wasn't damaged by a storm. And we've had tremendous success in putting pressure on staged accident rings by working with our law enforcement partners in regions like Tampa where this has become a major problem.

"We're seeing concern from our members about criminal rings that are deliberately damaging vehicle windshields in order to file an insurance claim, and in some cases are not doing satisfactory repairs or replacements.

"We encourage our member companies to keep up the excellent job of scrutinizing claims and referring them to NICB in an effort to ensure that their customers are not being cheated by the criminals who try to take advantage of the insurance company's desire to pay claims as quickly and efficiently as possible."

Anyone with information concerning vehicle theft and insurance fraud can report it anonymously by calling toll-free 1-800-TEL-NICB (1-800-835-6422), texting keyword "fraud" to TIP411 (847411) or by visiting our web site at www.nicb.org.

About the National Insurance Crime Bureau: headquartered in Des Plaines, Ill., the NICB is the nation's leading not-for-profit organization exclusively dedicated to preventing, detecting and defeating insurance fraud and vehicle theft through information analysis, investigations, training, legislative advocacy and public awareness. The NICB is supported by nearly 1,100 property and casualty insurance companies and self-insured organizations. NICB member companies wrote over $319 billion in insurance premiums in 2009, or more than 78 percent of the nation's property/casualty insurance. That includes more than 93 percent ($151 billion) of the nation's personal auto insurance. To learn more visit www.nicb.org.

SOURCE National Insurance Crime Bureau