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Department of Insurance Celebrates Response to Fraud in 2019

Captive | Captive Insurance | Insurance Commissioner | Date Posted: Wednesday, January 22, 2020


Fraud definition with magnifying glass

Fraud Bureau saw a 10% uptick in reports last year

The Delaware Department of Insurance made great strides in fraud detection and response during 2019. Throughout the year, 6 criminal arrests that included 21 charges were recommended from the Department’s Fraud Prevention Bureau to the Department of Justice, and 16 civil cases were brought forward resulting in more than $21,000 in fines. The Bureau received 551 referral cases in 2019.

“I want to commend our Fraud Prevention Bureau for their work identifying deceitful activity and helping to bring those who would defraud Delaware residents and companies to justice. Their efforts continue to send a strong message that fraud will not go unnoticed here, which can prevent future crimes,” said Commissioner Trinidad Navarro. “Through this work, we can help keep insurance premiums from rising by helping to make sure companies do not have to pay out fraudulent claims.”

Commissioner Navarro, who has a background in law enforcement, served as Vice-Chair of the National Association of Insurance Commissioners’ Antifraud Task Force over the last year and has championed fraud awareness and reporting. He was named Chair of the national Antifraud Task Force last week. The Department has experienced an increase reports over the past several years, with an approximate 23% increase since 2015.

In one prominent 2019 case, a resident was arrested after posing as family member who was terminally ill and facing imminent end-of life to open a life insurance policy. This was conducted through forgery of the family member’s identification, confirmation, and consent. After naming themself the sole beneficiary, the individual then attempted to collect $50,000 on the policy two days after the family member’s death. Charges included insurance fraud, identity theft, second-degree forgery, and crime against a vulnerable adult.

From identity theft to insurance healthcare fraud, hundreds of tips are investigated every year. In 2019, the most common schemes were seen through the application for auto insurance process, with individuals living outside the state attempting to save on premium costs by using Delaware addresses. Suspected to have risen due to possible economic factors, instances of application submissions occurring after an accident took place also grew. In addition to investigating tips from the public and insurance companies, the Bureau works with law enforcement in locating life insurance policies in death investigations.

The Fraud Prevention Bureau is fully funded by annual assessment fees, not taxpayer dollars, and employs 13 fulltime staff with extensive law enforcement and insurance investigative backgrounds and training, including credentials as Certified Fraud Specialists and Accredited Healthcare Fraud Investigators.

The Bureau facilitates the detection of insurance fraud and works to reduce fraud occurrence through enforcement and deterrence. Additionally, the Bureau requires restitution for deceptively obtained insurance benefits, and by doing so reduces the amount of premium dollars used to pay fraudulent claims, in turn decreasing the likelihood of premium increases.

The Delaware Department of Insurance Fraud Bureau can be reached toll free at (800) 632-5154, or (302) 672-7350, or by emailing fraud@delaware.gov. Reporting known or suspected fraud is free of charge and can be done confidentially.

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Department of Insurance Celebrates Response to Fraud in 2019

Captive | Captive Insurance | Insurance Commissioner | Date Posted: Wednesday, January 22, 2020


Fraud definition with magnifying glass

Fraud Bureau saw a 10% uptick in reports last year

The Delaware Department of Insurance made great strides in fraud detection and response during 2019. Throughout the year, 6 criminal arrests that included 21 charges were recommended from the Department’s Fraud Prevention Bureau to the Department of Justice, and 16 civil cases were brought forward resulting in more than $21,000 in fines. The Bureau received 551 referral cases in 2019.

“I want to commend our Fraud Prevention Bureau for their work identifying deceitful activity and helping to bring those who would defraud Delaware residents and companies to justice. Their efforts continue to send a strong message that fraud will not go unnoticed here, which can prevent future crimes,” said Commissioner Trinidad Navarro. “Through this work, we can help keep insurance premiums from rising by helping to make sure companies do not have to pay out fraudulent claims.”

Commissioner Navarro, who has a background in law enforcement, served as Vice-Chair of the National Association of Insurance Commissioners’ Antifraud Task Force over the last year and has championed fraud awareness and reporting. He was named Chair of the national Antifraud Task Force last week. The Department has experienced an increase reports over the past several years, with an approximate 23% increase since 2015.

In one prominent 2019 case, a resident was arrested after posing as family member who was terminally ill and facing imminent end-of life to open a life insurance policy. This was conducted through forgery of the family member’s identification, confirmation, and consent. After naming themself the sole beneficiary, the individual then attempted to collect $50,000 on the policy two days after the family member’s death. Charges included insurance fraud, identity theft, second-degree forgery, and crime against a vulnerable adult.

From identity theft to insurance healthcare fraud, hundreds of tips are investigated every year. In 2019, the most common schemes were seen through the application for auto insurance process, with individuals living outside the state attempting to save on premium costs by using Delaware addresses. Suspected to have risen due to possible economic factors, instances of application submissions occurring after an accident took place also grew. In addition to investigating tips from the public and insurance companies, the Bureau works with law enforcement in locating life insurance policies in death investigations.

The Fraud Prevention Bureau is fully funded by annual assessment fees, not taxpayer dollars, and employs 13 fulltime staff with extensive law enforcement and insurance investigative backgrounds and training, including credentials as Certified Fraud Specialists and Accredited Healthcare Fraud Investigators.

The Bureau facilitates the detection of insurance fraud and works to reduce fraud occurrence through enforcement and deterrence. Additionally, the Bureau requires restitution for deceptively obtained insurance benefits, and by doing so reduces the amount of premium dollars used to pay fraudulent claims, in turn decreasing the likelihood of premium increases.

The Delaware Department of Insurance Fraud Bureau can be reached toll free at (800) 632-5154, or (302) 672-7350, or by emailing fraud@delaware.gov. Reporting known or suspected fraud is free of charge and can be done confidentially.

Tweet this story

image_printPrint

Related Topics:  , , , , , ,


Graphic that represents delaware news on a mobile phone

Keep up to date by receiving a daily digest email, around noon, of current news release posts from state agencies on news.delaware.gov.

Here you can subscribe to future news updates.