S.C. Legislature to Discuss Insurance Fraud

During the past five years, insurance fraud complaints have grown by 61 percent in South Carolina, while the average U.S. family pays an extra $1,030 in insurance premiums each year to cover the cost of medical, auto, and life insurance fraud.

A proposal introduced put forward last year in the South Carolina legislature would have created a new civil fraud division in the Insurance Department, in addition to increasing the financial penalties and prison time for fraud.

However, the legislation stalled when differences over how assessments on insurance policies would be levied, but despite last year’s failure to enact legislation to address insurance fraud, the rallying cry is being raised again for a renewed effort to introduce similar legislation in the coming year.

“We support any efforts to help fight insurance fraud,” David Reddick, National Association of Mutual Insurance Companies state affairs manager said. “We’ll be anxious to see if Attorney General Henry McMaster brings forth any legislative initiatives to help increase his staff to fight fraud in South Carolina.”

According to a report in the Post and Courier of Charleston, insurance executives and state officials are increasingly worried that South Carolina is becoming a magnet for insurance scammers, driving insurance costs even higher.

While the number of fraud complaints have increased in South Carolina, the number of state employees fighting fraud has decreased from 20 to four including two agents, one prosecutor and one assistant.