From 2010 to 2012, the number of Florida questionableclaims (QCs) logged by National Insurance Crime Bureau (NICB)member companies increased 23 percent, according to a new reportfrom the Des Plaines, Ill.-based nonprofit organization. Perhapsthe most alarming finding is the dramatic 55-percent surge in QCsin southern Florida during that time, with the Miami metro arealeading the state.

If an NICB member company deems a claim suspicious—as in itmeets the criteria of a QC—it submits that claim to the NICB forcloser review and investigation. In order for this to happen, a QCmust exhibit one or more indicators of possible fraud. A singleclaim may contain as many as seven referral reasons. This mostrecent report analyzes QCs by loss city, core-based statisticalarea (CBSA), policy type, loss type, policy and loss type combinedand referral reasons.

Hotbeds of Suspicion

In 2010, NICB found that a total of 8,723 Florida QCs werereferred for closer examination. In 2011, that number increased to9,670, only to rise yet again in 2012 to 10,693. This represents anincrease of 23 percent compared to the 2010 figure. Thetop five cities in Florida generating the most QCs last year were:Miami (2,309); Orlando (877); Tampa (690); Jacksonville (637) andHialeah (361).

The top five CBSAs reporting QCs were Miami-FortLauderdale-Pompano Beach, Tampa-Saint Petersburg-Clearwater,Orlando-Kissimmee-Sanford, Jacksonville and Cape Coral-Fort Myers.It should come as no surprise that a state riddled with stagedaccidents and shady clinics reported a large number of PIP-relatedsuspicious claims. In fact, the most frequent loss types were:personal injury protection (PIP), bodily injury, other automobile,collision, and property damage.

The NICB notes that QCs represent a fraction of overall claimstraffic. Nationally in 2012, QCs totaled 116,268 out of an overallclaims population of more than 70.5 million—or 0.164 percent. Thevolume of QC referrals can increase or decrease over a given periodof time, depending on a number of factors, including betterreporting by the industry and fluctuations in fraudulentactivity.

South Florida easily led the state in QCs in 2012, with 4,686—up4,349 reported in 2011 and 3,033 in 2010. The Tampa Bay area camein second, at 1,260, although QCs there have declined by 39.4percent over the past two years. Miami-Dade County led the statewith 3,530 questionable claims in 2012, followed by Orange Countyat 1,097, Hillsborough County at 983, Broward County at 929 andPalm Beach County at 755.

There were 43 loss types identified in the 2010 QC data; 45 losstypes identified in the 2011 QC data, and 41 loss types identifiedin the 2012 QC data. PIP was the loss type with the most QCs ineach of the 3 years: they increased 24 percent between 2010and 2011, and then 10 percent between 2011 and 2012. The percentageof PIP-related QCs compared to the total number of Florida QCsincreased from 37 percent in 2010, to 41 percent in both2011 and 2012. The top three loss types were the same in each ofthe 3 years.