The amount of court-ordered restitution payments for insurance fraud in Kentucky has increased by 800% this year, the Fraud Division of the Kentucky Department of Insurance (DOI) has said.
The division, whose objective is to support the DOI’s mission and to aid law enforcement in criminal investigations of insurance fraud, announced the increase – to over $3 million this year, up from $369,762 in 2015 – last week, adding that the rise comes as 113 criminal convictions were secured in October.
The DOI’s commissioner, Brian Maynard, said that Kentucky’s citizens have been squeezed by higher insurance premiums, describing the move as “great news”.
“Fighting insurance fraud is one way to keep premiums lower,” Maynard said. “The Fraud Division is producing tangible results for the Commonwealth, making a difference for the residents of our state and showing Washington that insurance works when it’s left to the state rather than out-of-state bureaucrats.”
Maynard added that FBI statistics estimate that the total cost of non-health insurance fraud is more than $40 billion per year.
“That means insurance fraud costs the average US family between $400 and $700 per year in the form of increased premiums,” he said.
Division director Dwayne Depp said the DOI’s Fraud Division is doing its part to “create and promote a sound and fair marketplace by protecting the insurer and the insured from criminal activity,” adding that investigators and administrators work together to make sure “justice is served.”
The division said its investigations often center on commonly committed frauds such as staged car accidents, exaggerated or fabricated workers’ compensation, or personal injury protection claims.
It is currently coordinating more than 300 active fraud investigations with federal, state and local law enforcement authorities, according to Fraud Division program coordinator Shawn Boggs.
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