In the company’s second fraud-related lawsuit of 2013, AllstateInsurance Company is seeking $1.7 million in damages from three NewYork-area medical providers who allegedly engaged in a fraudulentmedical billing scheme.

The subsidiary of The Allstate Corporation, the nation's largestpublicly held personal lines insurer, has aggressivelypursued fraudsters while supporting legislative reformsintended to ferret out abuse of the state’s no-fault personal injury protection (PIP) system for manyyears.

Since 2003, the insurer has filed a total of 46 fraud lawsuitsin the state of New York State seeking more than $233 million indamages. Filed in the U.S. District Court, Eastern District of NewYork, this latest complaint against Gerald Surya, M.D., Sun MedicalCare of Nassau, P.C., and Sky Medical, P.C. involves a familiarfraud: inflated medical invoices for “unwarranted, unnecessary orundelivered” treatment and diagnostic testing.

Allstate alleges the defendants in the case—Dr. Surya, SunMedical Care and Sky Medical—fabricated medical claims by inflatingcharges and billing for services never rendered to cash in on thestate’s no-fault insurance benefits. The inaccuracy of such claimswould preclude compensation under New York law and thus serves asthe basis for Allstate’s motion to recoup the $1.7 million it paidto the defendants.

Though the outcome of this latest battle in the war againstinsurance fraud is not yet known, the case nonethelessillustrates the due dilligence required of insurers in protectingpolicyholders and the industry at large from ever-enterprisingfraudsters. In New York alone, no-fault fraud is estimated tocost consumers hundreds of millions of dollars each year, accordingto recent statistics from the Insurance Information Institute(I.I.I.).

“In essence, honest hardworking New Yorkers are paying a ‘fraudtax,’” said Allison McMahon, a spokesperson for Allstate. "We needlawmakers to enact meaningful insurance reform that puts thecitizens of New York first."

Numerous insurance carriers across the nation continue to lobbyfor comprehensive fraud-related reform and stiffer penalties.Stay tuned for updates on this case, along with the latest measuresto combat and deter insurance crime.