Georgia Launches New Portal to Combat Insurance Fraud
Posted in Legal Alerts on April 27, 2023
Recently, the Coalition Against Insurance Fraud (CAIF) released updated numbers that show the cumulative impact of insurance fraud. CAIF estimated that insurance fraud costs the economy upwards of $300 billion each year, and this figure may be a conservative estimate. Fraudsters get the upper hand because they tend to stay one step ahead of the authorities.
One of the issues that keeps authorities one step behind is the slow-to-nonexistent reporting of insurance fraud. To change that, Georgia’s Office of Insurance and Safety Fire Commissioner recently launched an online portal for people to report insurance fraud for criminal investigation.
Insurance Fraud Affects Both Insurance Companies and Policyholders
Insurance fraud is a serious problem in Georgia. Even a former Insurance Commissioner was recently indicted on charges of conspiracy to commit healthcare fraud and conspiracy to commit money laundering. There are schemes across the state that are both big and small. Recently, a Georgia woman was charged with fraud because she pretended to be a dead child's grandmother to claim a $35,000 life insurance payment.
Insurance fraud harms the public. The costs of fraud that insurers have to pay are commonly passed along to the public in the form of higher premiums. Additionally, insurance companies may need to perform additional investigations on claims to protect themselves from fraud, so their payment of claims could take longer for legitimate claims.
For these reasons, law enforcement has every incentive to move quickly and forcefully against fraudsters, both to punish them and prevent overall harm to Georgia’s economy.
Insurance Companies Often Work with Law Enforcement to Root Out Fraud
There are numerous people on the front lines working to catch and/or to stop insurance fraud. For example, on top of their in-house anti-fraud staff members, insurance companies are increasingly deploying artificial intelligence to analyze claims that are filed to spot both patterns and problems with the individual claims. Law enforcement also runs its own investigations, cooperating with both the federal government and agencies outside the state to disrupt large scams. However, government agencies also rely on tips and information from the public to detect insurance fraud. As many resources as law enforcement devotes to detecting fraud, they can only be in so many places at once.
The Georgia Department of Insurance Criminal Investigations Division (GADOI) does everything it can to root out fraud and catch wrongdoers. But for every arrest that its agents make, there are numerous fraudsters whose actions go undetected. When trying to catch insurance fraud and investigate tips, speed is of the utmost importance.
A New Portal Is Designed to Streamline and Automate Reporting
In the past, there may have been delays in reporting suspected insurance fraud to the GADOI. Many tipsters may not have wanted to go to the effort of calling the agency, being placed on hold, or having their call transferred endlessly. Some tipsters may have fallen through the cracks because there was no easy way to report insurance fraud. Law enforcement efforts improve when the public has an easy and seamless way of bringing things to law enforcement officers’ attention.
How to Use the New Online Insurance Fraud Reporting Portal
The GADOI has taken action to streamline this reporting and provide an online option for bringing insurance fraud to the agency’s attention. There is now an online tool called the Desk Officer Reporting System that allows for self-service reporting of the following:
- Insurance fraud
- Identity theft
- Public adjuster violations
- Theft by conversion (when insurance agents take your premium payment and do not apply it to your policy)
Given the growing prevalence of identity theft and the frequent acts of insurance fraud, it is anticipated that the public will report a fair number of tips over this system.
The new online portal is accessible to anyone, including:
- The general public
- Other law enforcement agencies
- Insurance companies
On the portal, the GADOI informs the public that insurance fraud is defined as “any criminal fraud with respect to insurance companies, agents, public adjusters, policies, and/or claims. This includes staged claims, material misrepresentation, inflated claims, etc.” In other words, there is a broad range of potential fraudulent schemes that could be reported.
The Portal Is Designed to Be Quick and Simple
The GADOI purchased a commercially available off-the-shelf system from LexisNexis to use as its online portal. The portal is a relatively simple interface that allows a user to enter the details of what they suspect to be fraud. The user can also compose a narrative to guide investigators. The portal was specifically designed to be streamlined and easy to use. After all, investigators do not want to discourage potential tips by using a system that is not user-friendly.
After a tipster enters information into the system, they will be able to track the status of a complaint. They will even receive alerts from the GADOI to let them know whether the complaint was approved or rejected. The GADOI will review the complaint and determine whether it should be assigned to a special agent. The agency may request additional information from the tipster.
The portal is generally intended to address issues where there is a known suspect. In cases where there is fraud but no known suspect, the agency encourages people to call it directly to report the fraud.
Insurance companies and businesses need to be vigilant to detect possible insurance fraud. Now, they have a more effective way of immediately bringing their concerns to the attention of law enforcement. This new system should work in tandem with existing fraud detection methods to allow for more prompt investigation by law enforcement since many fraudsters have proven to be nimble and have so far escaped the long arm of the law.