NU Online News Service, May 13, 12:37 p.m. EST
New York City has the distinction of being the nation's number one municipality for staged auto accident claims, the New York Alliance Against Insurance Fraud announced.
NYAAIF said a new analysis of questionable claims from the National Insurance Crime Bureau reported that 1,304 claims involving staged auto accidents were generated in New York City from 2007 to 2009. Tampa ranks "a distant second" with 562 claims, said NYAAIF.
Ellen Melchionni, president of NYAAIF commented in a statement that her organization is not surprised by the findings "since no-fault auto accident fraud is rampant in New York City. Criminals are capitalizing on a broken no-fault system that allows the fraud to occur."
The NICB analysis also found that New York State ranked second among all states with 1,680 staged accident claims during the 2007-2009 period--a ranking driven by the concentration of fraud in New York City. Florida led the nation with 3,006 staged accident claims. Both New York State and Florida have no-fault auto insurance systems.
NYAAIF said staged vehicle collisions are a costly part of New York State's no-fault auto insurance fraud problem.
These crimes are often committed, the organization said, by organized criminal enterprises which operate medical mills, predominantly in the New York City area. Corrupt medical clinics submit fraudulent claims for treatment that was either excessive, not necessary or never even performed, according to NYAAIF.
"Staged accidents are dangerous criminal activities that target innocent drivers with increasingly bold schemes aimed at defrauding insurance companies, but the ultimate victims are honest policyholders who pay more for auto insurance," Ms. Melchionni said.
NYAAIF noted that the New York-based Insurance Information Institute reported that fraud and abuse in the New York no-fault system accounts for roughly 20 percent of every no-fault claim paid--or about $1,561 per claim. Spread across the state, that amounted to nearly $230 million in "fraud taxes" in 2009, according to the Alliance.
NYAAIF is a cooperative effort by insurance companies in New York to educate consumers about the costs of insurance fraud, the many forms fraud can take and what you can do to help fight back.
More information about the group is online at www.fraudny.org for more information on NYAAIF. Individuals can also call 1-888-FRAUD NY to anonymously report suspected cases of fraud.
