Tag Archives: Special Investigation Units SIU

New Amendments Affecting Anti-Fraud Investigative Units

The Legislature has passed some amendments that are likely to affect your SIUs. We have reviewed the new law and would like to provide you with a summary of some of the most important points.

Chapter 2017-178, Laws of Florida, primarily amended § 626.9891, Florida Statutes and went into effect June 26, 2017, when the Governor signed the bill. These amendments deal with insurer “anti-fraud investigative units.” There is very little, if anything, that must be done now other than learn the law and know what your responsibilities and timelines are.

Although you have an SIU to cover the main features of the law, some new reporting requirements and designation of an anti-fraud unit with at least 2 hours of initial anti-fraud education and 1 hour per year after that, will require all insurers “to investigate and report possible fraudulent insurance acts” to Florida government. The amendments to § 626.9891 [insurer anti-fraud investigative units; penalties for noncompliance], Florida Statutes, provide the who, what, how, when and where.

SUMMARY

*There is no legislative staff analysis of this law

By December 18, 2018, DIFS shall create best practices for the detection, investigation, prevention, and reporting of insurance fraud and other fraudulent insurance acts. The report must be updated as necessary but at least every 2 years. The report must contain specified criteria set forth in the section.

The Department of Financial Services is authorized to create rules for the administration this section. This is neither the Office of Insurance Regulation nor the Financial Services Commission (Governor and selected cabinet).

While there are compliance dates for insurers and agencies, the bill became effective upon becoming a law on June 26, 2017. By December 31, 2017, each insurer must:

  • If not in-house, contract with others to provide anti-fraud services
  • Adopt anti-fraud plan (discussed below)
  • Designate at least one employee to provide these services
  • Electronically submit reports of anti-fraud plan with the name and contact information of designated person to DIFS
  • The additional cost to the insurer for compliance may be added as an administrative expense in rate requests

Each anti-fraud plan shall include:

  • Procedures for mandatory reporting of insurance fraud
  • Acknowledgement that the insurer provides education and training required by section
  • Description of anti-fraud education and training
  • Description or flow chart of anti-fraud unit
  • Rationale and justification for level of staffing and resources used by anti-fraud unit based upon specified criteria

By December 31, 2018, each insurer shall provide staff of the anti-fraud investigative unit at least 2 hours of initial anti-fraud training that is designed to assist in identifying and evaluating instances of suspected fraudulent insurance acts in underwriting or claims activities.

Annually, after the initial training, an insurer must provide such employees a 1-hour course that addresses detection, referral, investigation, and reporting of possible fraudulent insurance acts for the types of insurance lines written by the insurer.

The insurer shall report to DIFS specified information by December 19, 2019, and annually thereafter for each line carried:

  • Number of policies in effect
  • Amount of premiums written
  • Number of claims received
  • Number of claims referred to anti-fraud unit
  • Number of fraud related matters referred to anti-fraud unit that were not claim related
  • Number of cases referred to DIFS
  • Number of case referred to other LE agencies
  • Number of cases referred to other agencies
  • Estimated dollar exposure submitted to DIFS or other agencies

In addition to reporting for all lines, workers compensation lines shall also report by December 19, 2019, the following information:

*This is a decrease in the amount of information currently required for workers compensation fraud before the amendment

  • Estimated dollar amount lost due to workers comp fraud]
  • Estimated dollar amount recovered attributed to workers comp fraud for several designated criteria
  • Number of workers comp fraud cases referred to DIFS for several designated criteria

Creating § 626.9896 Dedicated insurance fraud prosecutors:

  • DFS shall collect specified data from each state attorney who has designated attorneys and paralegals exclusively for the prosecution of insurance fraud.  [criteria omitted]
  • DIFS shall report the data to the house and senate leaders by September 1, 2018, and annually after that.

Other provisions not discussed; viatical contracts; HMO anti-fraud unit requirements; stranger-originated insurance policies are now statutorily considered void and unenforceable; an insurer may opt out of preinsurance inspection of private motor vehicles.  Preinsurance inspection reports of DIFS are eliminated.

 

These are the highlights of the bill as it applies to automobile insurance.  It does affect other lines as mentioned and we would be happy to explain the law in greater detail should you request it. If you have any questions, suggestions or reservations, please do not hesitate to contact us so that we may assist you in not only understanding the new law but how it ought to be implemented and when.

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Filed under FL Legislation, Florida, Florida Division of Insurance Fraud, Insurance, Insurance Claims, Insurance Defense, Insurance Fraud

Roig Lawyers Tampa Attorney to Present “Emerging Trends in PIP SIU”

Roig Lawyers attorney Miguel R. Roura will present “Emerging Trends in PIP SIU” to a national insurance carrier in Tampa on August 5, 2015.

The presentation will educate adjusters on recent SIU trends, help identify fraud, and discuss various investigative tools used to fight fraud. Also, the presentation will review caselaw which will aid adjusters in determining what issues and facts create a solid or weak defense.

Miguel concentrates his practice in the areas of Personal Injury Protection (PIP)/No-Fault litigation and fraud (SIU) investigations. He also defends clients in cases involving bodily injury, uninsured motorist, property damage, and general liability litigation. The identification and investigation of fraudulent claims represents a significant portion of Miguel’s practice.

Miguel is a graduate of Stetson University College of Law (J.D., 2008) and the University of Florida (B.A., 2004).

About Roig Lawyers

Roig Lawyers is a multi-practice Florida Litigation firm with an unfaltering growing presence in the legal market celebrating 15 years of service, with more than 100 attorneys in 6 offices in Deerfield Beach, Miami, Orlando, West Palm Beach, Tampa, and Tallahassee. Roig Lawyers offers unparalleled legal representation in the areas of commercial litigation, construction, corporate law, real estate, banking and finance, labor and employment, and all phases of insurance defense litigation.

For more information about Roig Lawyers, visit www.roiglawyers.com.

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

CFO Jeff Atwater Supports Fighting Fraud During 2015 Legislative Session

CFO Jeff Atwater supports the Health Care Clinic Proposed Legislation House Bill 1127 and Senate Bill 1306 that strengthen the Agency for Health Care Administration’s (“AHCA”) Health Care Clinic Act (“HCCA”). The proposed legislation:

  • Creates new certificate of exemption mandates for clinics exempted from mandatory licensure in HB 119 and criminal penalties for certain AHCA clinic violations;
  • Increases the number of crimes that may be investigated by the Division of Insurance Fraud;
  • Requires insurers to have SIU departments with specific requirements and establishes state oversight to help fight insurance fraud;
  • Creates additional criminal penalties for unlawful claims, whether paid or not.

Please click here to review the full summary.

For additional information you may visit www.flhouse.gov.

If you have any questions concerning this topic, please contact any member of the Roig Lawyers Insurance Services Group.

Contributing Authors:

MICHAEL A. ROSENBERG

MARK J. ROSE

MIGUEL R. ROURA

DENNIS LAROSA

 

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Filed under Fla. Stat. 627.736 (2008)

Special Investigation Units Deliver ROI in Insurance Fraud Campaigns

With the cost of insurance fraud estimated to be a staggering $80 to $120 billion annually, insurance companies cannot afford to take an arbitrary approach in their overall fraud deterrence strategy.

According to a recent article in Property Casualty 360°, taking a closer look at the special investigations unit (SIU) is a proven strategy for effective fraud management. Three key objectives in SIU management are outlined below.

1. Know Ideal Roles for SIU Personnel

Knowing the skill set of SIU team members is often the best way to ensure that employees are up to the task of contributing to overall strategic implementation. Traditionally, investigators and insurance/business professionals make up the SIU industry, but each have separate strengths they can bring to the table.

Investigators with law-enforcement or investigative backgrounds are generally well suited to the front lines.  They typically understand the dynamics of fraud, can manage efficient investigations, and possess the critical interview skills that can lead to confessions. On the other hand, business-minded professionals can be effective in supervisory positions to triage cases, help analyze and assess, and make innovative data-driven decision to support your strategy.

2. Develop the SIU Departmental Strategy

Even though industry benchmarks can be a source in the design and operation of the SIU, the effects of insurance fraud are not universal due to differences in insurance companies’ products and applications/claims processes. Therefore, the most critical point in an SIU’s fraud strategy should involve data collection and analysis.

Data collection includes information like the number of investigators that are needed, how many cases they get, which cases are assigned, what technology is being used, as well as spending and budgets.  The data analysis can then determine if the right measurement systems are in place, and whether SIU metrics are being analyzed in a way that best adjusts to the company’s overall fraud strategy and efforts to maximize return on investment.

3. Capitalize on the SIU’s Power of Deterrence

Deterrence is a potent weapon in fighting fraud, but because many insurers are focused on projecting an image of simplicity and speed in the claims process, consumers may think companies are ignoring what is going on behind the scenes. Insurers are advised to balance the message that they are nabbing scammers while not appearing to deny claims unreasonably.

The article suggests that insurers create a dedicated webpage on the corporate website devoted to SIU efforts, starting with a description of what the SIU is and does. Special Investigation Unit success stories, including news of campaigns with state and national law-enforcement agencies, can demonstrate how SIU actions are helping to minimize increases in customers’ insurance premiums.

The goal is to communicate to the marketplace that there is a vetting process, that fraudsters are not getting away with their crimes, and that the company is trying to protect customers.

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Filed under Insurance Fraud

Special Investigation Units Learn the Latest Techniques to Stay Ahead of Fraudsters

The cost of fraud, which has an annual price tag of about $80 billion a year, is substantial to insurers as well as the general public. Special investigation units (SIU) put in place by insurers manage a multitude of ever-changing instances of suspected fraud.

The International Association of Special Investigation Units (IASIU) recently held a seminar and expo on insurance fraud to educate investigators about the latest trends and how to stop fraud by using the hottest tools available. Highlights of the conference were covered by Property Casualty 360° in a recent article.

Investigators, many of whom are former military and law enforcement professionals, learned about these newest scams and what they should look for in identifying them, places to find fraudsters, and how to conduct a thorough investigation.

Highlights in the seminar revealed:

  • Voice print” technology that tracks phone calls made by scammers: This technology can make a voice print, similar to a fingerprint, using biometrics to identify callers. Accents and other disguises to the voice will not defeat this technology.
  • A new database of voice prints: NICE Contact Center Fraud Prevention is creating a database of those voice prints to help insurers track and identify fraudsters who repeatedly file false claims.
  • Social media tools: These go beyond the traditional Google or Bing searches. Anyone using social media leaves a road map for investigators, allowing them to connect the dots between a scammer and his or her friends and associates without ever leaving their desks.
  • Information gleaned from staged car fires: A burned-out vehicle has a story to tell if you know how to read the clues. By learning about the properties of fire, ignition sources, burn patterns, what to look for at a burn scene, what types of evidence can be found, the mistakes that fraudsters frequently make, and reading air velocity and direction, investigators can gather the necessary data to rule out or make a case for fraud.

Although fraudsters often stay ahead of the game by introducing new ways to swindle insurers, investigators are now better equipped to handle what comes their way thanks to innovative technologies and techniques.

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Filed under Insurance Fraud