Contact: Hugh Strawn
Date: June 16, 2015
Insurance Fraud - The Texas Perspective
2015 Western Regional Adjusters Conference
Insurance fraud grew faster than the legitimate U.S. economy...fraud 16% v. U. S. economy 2%...from 2011 to 2012. Keynote speaker Kyson Johnson, Texas Department of Insurance, brought the attendees at the 2015 Western Regional Adjusters Conference up to date on criminal attacks on the insurance system.
Texas Department of Insurance - Fraud Unit
Combating insurance fraud in Texas is an ongoing law enforcement undertaking of the Texas Department of Insurance. The stakes are huge. The Texas insurance market is the tenth largest in the world with a premium volume of about $127.2 billion. The Fraud Unit received 13,341 reports of suspected insurance fraud in 2014, reflecting continued growth in the crime since 2009, when it received 11,021 reports.
Johnson reported that the Fraud Unit opened 728 cases for investigation in 2014 and referred 189 of those for prosecution. Those referrals represented about $9.9 million in fraudulent claim activity. The courts delivered 75 judgments and ordered total restitution of $24.4 million from the criminals to insurers and the state.
The leading cases of Texas insurance fraud were weather-related claims, mostly for phony hail damage. Following close behind were cases for medical fraud, staged auto accidents, owner give-up schemes, health care fraud, fraud by both agents and adjusters, and barraty, which is the act of a ship's master or crew to damage a vessel or cargo through scuttling, theft of the cargo, and so on.
Johnson advised the claims professionals at the General Session of the 2015 Western Regional Adjusters Conference that a proven method of detecting and derailing insurance fraud is when the adjuster is precise, and oversees the file to ensure compliance with the terms. Precision is augmented by persistence in discovering the truth when the facts contained in a file seem to be somewhat cloudy. Adjusters should always keep an open mind, said Johnson, and not allow themselves to make assumptions.
The 2015 Western Regional Adjusters Conference began with the General Session on Tuesday morning, June 16, at the Embassy Suites Frisco Hotel in Frisco, Texas. it is the first of three PLRB regional conferences that will be held this year.
The breakout sessions with continuing professional development in casualty claims, property claims, as well as in general interest insurance claims disciplines began immediately following the General Session.
The Western Regional Insurance Services Expo also opened Tuesday in conjunction with the Conference. Claims service providers from Texas, the western region, as well as nationally based companies were available in the expo hall to show the attendees what's new to assist them in managing their claims.
Adjuster Continuing Education Credit was available at no cost for adjusters licensed in Texas, Oklahoma, and Florida.
The 2015 Western Regional Adjusters Conference will conclude Wednesday, June 17.
The PLRB will host the 2015 Central Regional Adjusters Conference, September 9 and 10, in Columbus, Ohio. It will also host the 2015 Eastern Regional Adjusters Conference, November 10 and 11, in Atlanta, Georgia.
The Property & Liability Resource Bureau is a not-for-profit association of property and casualty insurance companies. It is located in Downers Grove, Illinois.