Florida currently leads the nation in fake or staged accidents, aka personal injury protection fraud. Being the best at something is typically something to brag about, but in this case, these fraudulent actions are driving up the cost of automobile insurance for every policyholder in the state.
The masterminds of these schemes are collecting millions and it is costing the average Florida family with two cars in the driveway as much as $100 in higher auto insurance premiums every year.
As your chief financial officer, I am committed to making sure that Florida will no longer lead the nation in reports of fake or staged accidents.
PIP fraud accounts for more than 40 percent of Florida's insurance fraud cases reported to the Division of Insurance Fraud, a law enforcement agency within the Department of Financial Services.
My fraud division aggressively pursues fraud and leads the nation in recovering insurance fraud-related losses through court-ordered restitution.
PIP is the personal injury protection portion of your automobile policy and covers medical treatment for injuries suffered in a crash. According to the National Insurance Crime Bureau, Florida has three of the top five cities nationally for questionable medical claims associated with staged accidents: Tampa, Miami and Orlando.
More than 3,000 staged accidents were reported in Florida between 2007 and 2009, more than twice the number reported by New York, which is No. 2 on the list.
So often, the architects of these crimes are not who you would necessarily suspect. They include: patients, clinics and clinic owners, attorneys, senior citizens, doctors and/or chiropractors.
PIP fraud is happening every day. Typical players involved in PIP fraud are:
. The patient. The patient must have insurance and most are aware that what they are doing is wrong. On the other hand, some patients may be unaware of the scam.
. The clinic. If the clinic's primary function is to treat accident patients, there is going to be some level of fraud. To compete and survive, accident clinics must "buy" patients, stage accidents or file fraudulent claims.
. The clinic owner. Typically, the "hands-on" organizer of the fraud scheme is the clinic owner. Owners may provide cars for the staged accidents, train employees on how to commit PIP fraud, hire runners to supply patients to the fraudulent clinic and oftentimes, finance the staged accidents.
. The runner. An individual uses a scanner to listen for police dispatch of car accidents and may also obtain crash reports. The runner then contacts the accident victims with the promise of cash, car repairs or a settlement from a lawsuit. Often, the runner will tell patients they don't have to receive medical treatment, just sign the paperwork and receive cash on the spot for their insurance information.
. The attorney. An essential player in the scheme, he or she works closely with clinic owners and may also have runners on staff.
. The doctor. To commit PIP fraud, the clinic needs a licensed doctor and/or chiropractor. Typically, doctors are medical directors at multiple clinics and may actually treat only a small number of patients in accident clinics. In some cases, the doctors are elderly or near retirement and are paid to fabricate or sign fake reports.
Seniors are not exempt from these predators and can fall victim to the schemes, especially when the scammer is a senior, as well.
All consumers should use caution when they receive phone calls after an accident, as it may be someone trying to initiate a fraud scheme. Thoroughly review all billing statements you receive for doctor's services and never sign blank insurance or medical forms.
According to the Insurance Information Institute, staged accidents and phony medical treatment will add about $1 billion to the cost of fraud in Florida's no-fault auto insurance system by the end of 2011, if the current trend continues.
We will put a stop to these fraudsters who take money out of the pockets of hard-working Floridians. With the support and assistance of consumers, law enforcement and our partners in the insurance industry, my department will continue to bring these criminals to justice.
If you or someone you know has been the victim of insurance fraud, or if you think you may have been a victim, please visit www.MyFloridaCFO.com or call our Fraud Hotline at (800) 378-0445.
If information you provide leads to an arrest and conviction, you may be eligible for a reward of up to $25,000.
Jeff Atwater is Florida's chief financial officer.