NEW YORK–A proposal for legislation to halt auto accident schemes could inadvertently hamper fraud investigators, an insurers' trade group told state insurance regulators here.

The warning came from Don Cleasby, assistant general counsel for the Property Casualty Insurers Association of America, speaking at the AntiFraud Task Force session of the National Association of Insurance Commissioners.

Saturday at NAIC's spring meeting the task force approved a report on development of a model law to its parent committee.

The law aims to curb so-called “runners” from obtaining official accident information with the intent of pursuing victims to persuade them to sue and seek medical treatment with litigation in mind.

The statute would require any person seeking to obtain an accident report to provide photo identification and a signed statement that they are not prohibited from gathering such information.

Mr. Cleasby told the panel that such a requirement could impede legitimate investigations by insurers following an accident claim.

“This will add to the expense of such investigations and will likely delay an insurer's ability to complete the investigation,” he said.

The panel later exempted third-party vendors who investigate such claims on behalf of insurers from such requirements but not the insurers themselves.

Mr. Cleasby said that since many of these records are obtained electronically, providing government-issued photo identification could prove problematic in the future.

He added that a section of the model law requiring local law enforcement to maintain such requests for motor vehicle records could produce a costly administrative burden for the agencies involved.

Special Reports /

Antifraud Law Stirs Industry Concern

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