Allstate has filed 28 fraud lawsuits in New York State since 2003, seeking more than $165 million in damages, the company reports.
The state of New York is in an insurance fraud crisis revolving around no-fault fraud, according to the Insurance Information Institute. Estimates of costs to New Yorkers have hovered at hundreds of millions of dollars year-after-year.
A coalition of consumers, small businesses, elected officials and insurance trade associations established
"In essence, honest, hardworking New Yorkers are paying a ' fraud tax,'" said Krista Conte, spokesperson for Allstate's New York office. "We need lawmakers to enact meaningful insurance reform that puts the citizens of New York first."
The complaint alleges that New York medical professional corporations: Right Aid Diagnostic Medicine P.C., A Plus Medical P.C., Omega Medical Diagnostic P.C., Shore Medical Diagnostic P.C., Oracle Radiology of NY P.C., Atlantic Radiology Imaging P.C., Atlantic Radiology P.C. and Aurora Radiology P.C. were fraudulently incorporated through a scheme using the names of licensed medical physicians, and that lay-owners, none of whom were physicians, secretly owned and controlled the professional corporations. Attempts to reach the defendants were unsuccessful at this writing.
Allstate's complaint further alleges that these defendants caused the submission of fraudulent claims and MRI reports to Allstate demanding payment of no-fault benefits.
The lawsuit was filed following an investigation by Allstate's special investigative unit, and seeks reimbursement for personal injury protection benefits Allstate paid on behalf of its customers during timeframes specified in the lawsuit. The lawsuit is the latest in a string of actions taken by the insurer to protect consumers from these and similar activities.