Filed Under:Markets, Regulation/Legislation

One Year After Sandy, New Jersey Regulator Warns of Insurance Fraud

One year after Superstorm Sandy struck the state, New Jersey Department of Banking and Insurance Commissioner Ken Kobylowski is cautioning consumers to remain vigilant about insurance fraud.

“Each year, insurance fraud costs companies tens of billions of dollars,” said Commissioner Kobylowski. “Ultimately, this costs consumers in the form of higher premiums. Understanding, identifying, and reporting insurance fraud can help reduce insurance premiums for everyone.”

New Jersey regulations define insurance fraud as the knowing misrepresentation of, or failure to disclose, any material fact that impacts the handling of an insurance claim or the underwriting of an insurance risk. Changing facts of a claim or risk to increase a claims payment or lower an insurance premium constitutes insurance fraud and should be reported when observed, Commissioner Kobylowski said.

For example, Commissioner Kobylowski continued, consumers rebuilding and recovering from Superstorm Sandy should be aware that unscrupulous fraudsters continue to prey on victims. He added that New Jerseyans should remain cautious of contractors or adjusters making claims that sound too good to be true. Any homeowner approached by individuals who encourage an opening or reopening of an insurance claim with promises of covering a deductible should be wary, Commissioner Kobylowski concluded.

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