Tag Archives: Auto Insurance

Travelers Advocates Current Auto Insurance System for Autonomous Vehicles

Travelers Institute released a white paper expressing their view on autonomous vehicles (AVs) and the role the auto insurance industry should play in addressing the significant policy questions and challenges that will inevitably arise in the future. An insurer that has been around for more than 160 years, Travelers applauds the safety advances of AVs and believes that the current auto system can accommodate AVs and non-AVs.

Click here for the white paper.

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Filed under auto insurance, Autonomous Technology

Deltona Man Charged With Arson in Insurance Fraud Scheme

Brian Lee Caswell of Deltona was arrested and charged with second-degree arson, arson resulting in injury, burning to defraud an insurer, giving false information to a law enforcement officer and making a false police report.

According to Caswell’s arrest warrant, he had hatched a plan with Alex Spivey of Orlando and Melinda Philbrook of Lady Lake to destroy their truck and collect an insurance payout. Caswell initially claimed the vehicle had been stolen, but later admitted planning the scheme after co-conspirator Spivey caught fire during the arson.

Click here to read the full article.

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Filed under auto insurance, Auto Insurance Fraud, Florida, Fraud, Insurance, Insurance Claims, Insurance Defense, Insurance Fraud

Pending PIP Litigation on the East and West Coasts Could Impact States In Between

PropertyCasualty360 published a report about pending automobile personal-injury litigation in California and New York that could have a lasting impact if the decisions spread to other jurisdictions. Courts will determine allowable evidence for suits involving these insurance claims.

East Coast

In New York, insurers investigated radiologist Andrew Carothers, a suspected illegal straw owner after he filed 20,000 lawsuits against auto-insurance carriers. After insurers refused to pay Carothers, he flooded the state’s courts with more than 20,000 lawsuits seeking collection for unpaid “services.” The civil cases were consolidated, and the jury agreed Carothers was fraudulently engaged in the corporate practice of medicine. The Appellate Division affirmed, so Carothers went to the New York Court of Appeals, where the case awaits a decision.

A favorable decision can deter scams like Carothers’ in other states that forbid the corporate practice of medicine. Fraudsters who often quickly expand operations to line their pockets in other states could be deterred. A decision is expected in 2019.

West Coast

Dave Pebley was involved in a serious vehicle accident, sought medical care and filed suit. He had health coverage but decided not to submit his bills for payment. That is because, under California law, the jury would only hear about the amount paid by his health insurer as the measure of his medical expense while Pebley was billed at the top rate for medical services by refusing to use his health insurance.

The insurer cried foul, asserting that such actions mislead the jury, and are fraudulent because medical providers never expect to receive such high payments. They argued the plaintiff may present the higher medical bills but must provide expert testimony to prove the charges are fair and reasonable. Similarly, the defendant or their insurer may present counter-evidence as to what the health providers normally accept for payment of those services.

The California Second District Court of Appeal reasoned that juries should be allowed to ultimately decide the appropriate charge for the medical services. Parties are lining up to support an appeal of the case to the state Supreme Court. If Pebley succeeds in California, potentially winning the $3.6 million he seeks, the strategy of refusing to use health insurance can be expected to spread rapidly to other states.

Click here for full article.

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Filed under auto insurance, Auto Insurance Fraud, Fraud, Insurance, Insurance Claims, Insurance Defense, Insurance Fraud, PIP, PIP/No Fault, Uncategorized

Two GEICO Adjusters Charged in Miami Insurance Fraud Ring

On Monday, July 10th, 14 people were charged in “Investigation Vehicle Roulette” conducted by Florida’s Bureau of Insurance Fraud and the State Attorney’s Office. Two GEICO insurance adjusters, Juan Carlos Diaz and Cesar Santiago Tapanes, prosecutors say got cash kickbacks for helping defraud their own company were among those arrested.

In September 2016, a Lexus GS350 was involved in a fender bender with a Chrysler 320 in North Miami-Dade. The rogue insurance adjusters reported inspecting the Lexus and authorized a series of payments totaling over $16,000. However, investigators say the accident never actually happened.

In fact, the same Lexus had been the subjection of 10 previous claims involving crashes that never occurred, all signed off by Diaz and Tapanes. The scam ended up costing GEICO more than a million dollars.

According to an arrest warrant by detectives, at least 45 bogus claims were made. The group faces charges including grand theft, insurance fraud, and racketeering.

Click here for full article.

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Filed under auto insurance, Auto Insurance Fraud, Florida, Florida Division of Insurance Fraud, Fraud, Insurance, Insurance Claims, Insurance Defense, Insurance Fraud

Appeal Court Backed Air Ambulance Firm in PIP Dispute

The 11th U.S. Circuit Court of Appeals backed air-ambulance firm Air Methods Corp. in a dispute stemming from a traffic accident that resulted in the death of accident victim Lemar Bailey about whether the amount paid for helicopter services should be limited by Florida’s no-fault auto insurance law. The federal appeals court ruled that the air-ambulance firm is considered an air carrier under federal law and should be able to bill the child’s father, Lenworth Bailey, for costs that exceeded the limits in the state’s no-fault system.

Following the March 2013 accident, Air Methods Corp. billed $27,975 for its services. Bailey’s auto insurer, State Farm Mutual Automobile Insurance Co., paid $6,911 under the fee schedule. His health insurer, Aetna Life Insurance Co. paid another $3,681. However, Bailey did not pay the remaining balance of nearly $17,400. He filed a potential class-action lawsuit alleging that the air ambulance company was trying to improperly collect amounts in excess of the fee schedule. However, the judge ruled in favor of the Air Method, which led Bailey to the appeals court that also rejected such arguments.

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Filed under auto insurance, FL Legislation, Florida, Insurance, Insurance Claims, Insurance Defense, Lawsuits, Personal Injury Protection, PIP, PIP/No Fault

UPDATE: Ringleader Pleads Guilty To His Role In $23 Million Auto Insurance Fraud Crime Ring

Andrew Rubinstein of Miami and the self-confessed ringleader, Felix Filenger of Sunny Isles pleaded guilty to a racketeering conspiracy charge last year. Rubinstein and Filenger were paying kickbacks to tow truck drivers and body shop workers who illegally steered accident victims to chiropractic clinics they owned at a rate of $1,500 to $2,000 per “patient.” Clinic workers would then have patients attend multiple visits, document exaggerated pain levels, and bill insurance providers for treatment in the amount of $10,000, the maximum allowed under Florida law.

According to Prosecutors, the clinics were located throughout south and central Florida, including Sunrise, Hollywood, Hallandale Beach, Pompano Beach, Delray Beach, West Palm Beach, Miami, Orlando and Kissimmee.

Under the terms of his plea agreement, both sides had agreed to recommend the six-year sentence for Rubinstein. Filenger’s sentencing has been postponed. Several other people who also admitted their roles in the fraud are scheduled for sentencing later this year.

Click here to view the full article. (Previous post)

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Filed under Auto Insurance Fraud, Florida, Fraud, Insurance, Insurance Fraud, Personal Injury Protection, PIP, PIP/No Fault

Florida Man Arrested for False Insurance Claim

Insurance Journal has reported that a Florida man, Claude Milhomme, was arrested for attempting to file a false insurance claim for his vehicle. According to the Department of Financial Services’ Disaster Fraud Action Strike Team (DFAST), Milhomme filed a claim in September stating water damage to his vehicle caused by Hurricane Irma in the amount of $225 for a diagnosis, after hours fee and storage fee.

DFAST received a suspected fraud tip about one month later. After an inspection by state investigators, it was revealed that Milhomme’s vehicle was mechanically inoperable prior to Hurricane Irma’s landfall in September of 2017.

Click here to view the full story.

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Filed under auto insurance, Auto Insurance Fraud, Florida, Insurance, Insurance Claims, Insurance Fraud

Judge Dismisses Lawsuit of Injured NJ Driver Who Maintained FL Insurance Policy

A New Jersey judge has ruled that Jeffrey Scholes, a man living in New Jersey but driving a car registered and insured in Florida, may not sue another New Jersey driver for injuries he sustained in a car accident. Judge Patrick Bartels of Essex County Superior Court dismissed Scholes’ personal injury lawsuit against defendant Stephen Hausmann on Oct. 24 citing that it would be a violation of the state’s automobile insurance statutes as Scholes fraudulently maintained a Florida automobile insurance policy while living in New Jersey.

Bartels noted that Scholes had been living and working in New Jersey since 2009 but maintained a Florida insurance policy issued by GEICO, registered his car there and had a Florida driver’s license because it was more cost-effective.

According to the ruling, Scholes was “severely injured” when he was struck head-on by Haumann’s car on Oct. 23, 2014, in South Orange. Although Scholes sustained back injuries that required epidural injections and surgery, Hausmann moved to have Scholes’ lawsuit dismissed on the grounds that New Jersey law requires that people who live in the state and who have a car here must maintain New Jersey car insurance.

Bartels agreed. “[W]e agree that plaintiff’s automobile is not considered insured pursuant to New Jersey law,” he said.

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Filed under auto insurance, Auto Insurance Fraud, Florida, Insurance, Insurance Fraud, New Jersey, PIP

Attorney Fee Multipliers in PIP and the Search for a Guiding Lodestar

In October 2017, the Supreme Court again addressed the issue of contingency fee multipliers to awards of attorneys’ fees. Personal Injury Protection (PIP) Plaintiff attorneys felt a tinge of delight and perhaps delayed buying their lottery tickets in hopes that this new decision will help them win an attorney fee multiplier if they prevail in a PIP suit. While HB 119 in 2012 eliminated multipliers from newer PIP lawsuits, there are still many older cases that are now being resolved which face the possibility of large awards of attorney fees going to Plaintiff attorneys. Additionally, there is no penalty for a Plaintiff attorney to attempt to pursue a multiplier, thus the key question is how to best defend against this potential windfall.

To understand the new decision in Joyce v. Federated Nat’l Ins. Co., 2017 Fla. LEXIS 2070 (Fla. 2017), it is beneficial to look back at the Florida Supreme Court’s interpretation of how and when to award a multiplier. The seminal decision regarding the applicability of multipliers is still the Quanstrom decision from 1990. Specifically, the requirements under Quanstrom necessary to find a fee multiplier are:

  1. Whether the relevant market requires a contingency fee multiplier to obtain competent counsel.
  2. Whether the attorney was able to mitigate the risk of non-payment in any way.
  3. Whether any of the factors set forth in Rowe are applicable, especially, the amount involved, the results obtained, and the type of fee arrangement between the attorney and his client. Id. at 834.

Joyce re-iterates that a market inquiry as to whether a multiplier was necessary to obtain competent counsel is the primary factor under the Quanstrom[1] requirements. This is important to PIP litigation since there are few, if any, potential PIP lawsuits that cannot find a warm and welcoming PIP attorney eager and willing to take the case.

Interestingly, the Florida Supreme Court in Joyce noted that the United States Supreme Court in 1992 revisited the issue of contingency fee multipliers in Burlington v. Dague, 505 U.S. 557 (1992), concluding that “enhancements for contingency [was] not permitted under the fee-shifting statutes at issue…[and] Justice Scalia, writing for the majority, reasoned that enhancement for contingency would likely duplicate in substantial part factors already subsumed in the lodestar.” Joyce. at 17, citing Dague at 567.

Under Joyce, the Florida Supreme Court separated itself from this federal precedent and continued to allow the use of multipliers under Florida law. The fear was that without the possibility of contingency multipliers some individuals with meritorious claims would fail to obtain competent counsel and the Florida Supreme Court noted “their usefulness in helping parties secure legal representation and their importance in ensuring access to Courts.” Id. at 17-18 citing Bell v. U.S.B. Acquisition Co., Inc., 734 So.2d 403, 411 (Fla. 1999). In other words, the Florida Supreme Court was concerned that Justice Scalia failed to consider that without a potential multiplier there is a danger of never obtaining competent counsel. Id. at 25. But with the thousands of PIP lawsuits being filed every year, can a Plaintiff truly make an argument that finding a PIP attorney is difficult?

Under Joyce, it appears that contingency fee multipliers are alive and well under Florida Law, and there are some circumstances where they are certainly warranted. Paradoxically, the best argument against the applicability of multipliers to the majority of PIP lawsuits comes from the Joyce opinion itself. The majority opinion which intentionally diverged from federal precedent on multipliers in order to preserve access to courts appears to have absolutely no concern about whether prohibiting multipliers in PIP lawsuits somehow prevents individuals from obtaining fair access to courts or diminishes one’s ability to obtain competent counsel. The dissent also argues that PIP litigation suffered no decrease in volume after HB 119 and that there was no negative impact on an insured’s ability to obtain counsel in PIP cases. Id. at 40-41. The dissent even cites the Plaintiff’s own expert testimony that there is no lack of attorneys willing and able to take PIP cases and “that same fee expert begrudgingly ‘hate[d]’ to admit that plaintiffs’ attorneys throughout the entire State of Florida are abundantly motivated to take PIP cases (even though PIP cases contain no possibility of a multiplier).” Id. at 42.

The majority opinion in Joyce actually agreed with the dissent that PIP litigation is different because of the number of attorneys willing to take PIP lawsuits. The majority opinion notes that PIP should not be compared to other types of first-party litigation since, “the fact that there are attorneys who specialize in PIP claims, which can be handled with relative ease in a volume practice, does not correlate with the availability of competent attorneys who are willing to litigate other types of insurance coverage cases, where generally more complex issues are raised.” Id. at 25. Clearly, the majority opinion is willing to differentiate PIP lawsuits from other types of first-party litigation due to the ease of obtaining a competent attorney.

Ultimately, none of the Quanstrom factors changed with the recent Joyce decision. However, the new opinion does provide an excellent analysis and justification as to how multipliers developed under Florida law and why the Supreme Court continues to think multipliers are necessary to ensure fair and equal access to the courts. It is important to keep in mind that Joyce does not mean a PIP lawsuit can never justify a multiplier. In fact, the Quanstrom decision is a PIP lawsuit[2]. Understanding the best way to contest aggressive attempts to collect fee multipliers and create an appropriate record at the trial court level remains important in PIP litigation.

[1] Standard Guaranty Insurance Co. v. Quanstrom,555 So.2d 828 (Fla. 1990)
[2] Other notable PIP lawsuits have been awarded multipliers after there was substantial and competent evidence to justify that a multiplier was necessary.  See  State Farm Fire & Casualty Co. v. Palma, 555 So.2d 836 (Fla. 1990)

If you have any questions on this issue, please feel free to contact our Insurance Services Team at info@roiglawyers.com.

ROIG Lawyers is a minority-owned litigation firm with a primary focus on Insurance Defense Litigation. We serve as primary counsel for numerous national and regional carriers and corporations related to all aspects of insurance litigation from seven offices throughout the state of Florida. ROIG Lawyers does not intend to create an attorney-client relationship by offering this information, and anyone’s review of the information shall not be deemed to create such a relationship. E-mail list/s from ROIG Lawyers are intended to provide information of general interest to the public and are not intended to offer legal advice about specific situations or problems.  You should consult a lawyer with regard to specific legal issues that require attention.

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Filed under auto insurance, Florida, Insurance, Insurance Claims, Insurance Defense, Personal Injury Protection, PIP, PIP/No Fault, Uncategorized

Panama City Woman Sinks SUV for Insurance Money

According to the Panama City News Herald, 65-year-old Debra Jenkins has been arrested and charged with insurance fraud after having her SUV driven into a lagoon and pretending that the vehicle was stolen. The police had reportedly found a stick inside the vehicle on the driver’s floorboard which appeared to be purposely placed there to hold the gas pedal after the car was removed from the water. Video evidence from Jenkins’ neighbor also showed her SUV leaving her home together with another SUV, then only the second SUV returning that night with two people inside.

Jenkins later admitted to deputies that she and a friend had devised the plan to get rid of the vehicle and claim insurance money.

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Filed under Auto Insurance Fraud, Florida, Insurance, Insurance Claims, Insurance Fraud