Insurers Report Rise in Questionable Claims Led By Hail, Auto Glass
Property/casualty insurance companies are reporting that the number of claims requiring more scrutiny than normal rose again in the first half of this year compared to 2009.
The National Insurance Crime Bureau’s first half 2010 questionable claims (QC) 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.
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.
“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,” the report notes.
“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.
Wehrle said NICB, its member insurers and law enforcement have pursued 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. They have also been putting pressure on staged accident rings in various regions including 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,” Wehrle said.
NICB is supported by nearly 1,100 property and casualty insurance companies and self-insured organizations.
Source: National Insurance Crime Bureau
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