A comparison of third-quarter data from 2009, 2010 and 2011 reveals a notable increase in the number of questionable claims submitted, according to a new report issued by the
Questionable claims comprise those claims that NICB member insurance companies refer to NICB for closer review and investigation based on one or more indicators of possible fraud. “Any given claim may have one referral reason or up to seven,” NICB strategic analyst Jason DiNovi, told Insurance Networking News.
Referrals under workers' compensation and casualty policies posted gains while property and commercial policies saw slight decreases. Vehicle claims were flat overall; however, the vehicle referral reason "hail damage" increased 103 percent from the third quarter of 2010.
The report holds that during the first three quarters of 2009, a total of 62,341 QCs were referred. During that same period in 2010, that number increased to 70,295 and continued to increase to 74,944 through the third quarter of 2011.
“Overall, there was a 7-percent increase in QCs through three quarters of 2011 compared with the same period in 2010, and a 20-percent increase when compared with the same period of 2009,” confirmed DeNovi.
Review of all three years’ data reveals some consistency in referrals, for example, when various referral reasons for property loss claims are measured, suspicious theft/loss consistently is the top-ranked referral. In vehicle referral claims, questionable theft consistently ranked number-one among QC reports.
Casualty claims score similarly across all three years, with faked/exaggerated injuries taking the top spot. In commercial referrals, the slip-and-fall claims were the most referred, and in workers’ comp, claimant fraud ranked as the number-one referred claim.
However, in the miscellaneous category, referral reasons increased 16 percent from the first three quarters of 2010 to the first three quarters of 2011, which represented the most substantial increase in referral reasons submitted among all referral reason categories for that time period.
The miscellaneous referral reason category also remained the highest submitted by volume among all referral reason categories at 58,354. While premium avoidance referral reasons had the highest percentage increase (44 percent), prior loss/damage had the highest volume increase in referral reasons from the first three quarters of 2010 to the first three quarters of 2011. Prior loss/damage increased by 1,446 referral reasons submitted. Informant tip/law enforcement referral reasons fell 18 percent from the first three quarters of 2010 to the first three quarters of 2011.
