Paying insurance deductibles to lure consumers into signing repair contracts for damaged autos or homes opens the door to fraud and forces insurance premiums higher, the Coalition Against Insurance Fraud told the Maryland Senate Finance Committee today.
“Inducements ultimately will lead to dishonest business practices and damage the vast majority of insurance consumers in Maryland,” Howard Goldblatt, the Coalition's director of government affairs said in testimony today.
The committee is debating a bill (SB 736) that makes offering inducements an act of insurance fraud, a felony. The House is considering a companion measure (HB 763). Rebating deductibles is so widespread and damaging that at least half a dozen states have passed similar bills in the last two years.
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