Conducting business in what is often termed the nation's epicenter for organized auto insurance fraudsters--namely, those who deliberately crash vehicles and falsely report injuries from auto accidents--is a challenge. For Florida-based Direct General Insurance Co., that challenge may have temporarily lessened somewhat, thanks to a recent eight-month investigation and resultant dismantling of an organized "crash ring."
Direct General reports that its collaboration with law enforcement agencies has resulted in the dismantling of a major auto insurance fraud ring in Central Florida.
"Operation Crash for Cash" was spearheaded by the Hillsborough County Sheriff's Office, with the assistance from the Florida Department of Insurance Fraud, the National Insurance Crime Bureau (NICB), Direct General and other auto insurers.
As part of these auto insurance fraud schemes, "injured" drivers and passengers seek treatment from crooked medical providers, who file false insurance claims in order to max out the $10,000 in Personal Injury Protection (PIP) coverage that Florida law requires all drivers in the state to carry.
Typically, members of these "crash rings" - including drivers and passengers who falsely claim injuries, "runners" who solicit those involved in crashes, and unethical medical providers who over-utilize treatment - gain financially by sharing fraudulently-obtained insurance money. Most concerning, these professional shysters don't think twice about injuries they cause to unsuspecting drivers and passengers as a result of their staging crashes, notes the insurer.
While there were no legitimate injuries caused by fraudsters identified in Operation Crash for Cash, investigators estimate that insurance companies would have been fraudulently billed $18 million due to fake injuries and claims.
To date, the ongoing joint probe has resulted in more than 50 arrests and the investigation of four medical clinics. Authorities have thus far filed charges ranging from racketeering to staging auto accidents to insurance fraud.
The operation underscores Direct General's "zero tolerance" policy toward auto insurance fraud, as well as the company's enhanced efforts in partnering with law enforcement agencies to crack down on criminal activity, wherever it occurs, said Jim Sclafani, Direct General's Chief Claims Officer.
"Particularly in Central Florida, where the number of staged auto accidents is soaring, Direct General will continue to invest in corporate resources and explore new ways to collaborate with law enforcement agencies to help combat auto insurance fraud," Sclafani said. "Reducing fraudulent claims is a key aspect in keeping auto insurance rates down for honest drivers."
As auto insurance fraudsters have migrated from South Florida into Central Florida, Direct General has strengthened its fraud detection training for claims personnel and adjusters and increased resources in its Special Investigations Unit, Sclafani said.
Register or login for access to this item and much more
All Digital Insurance content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access