Insurance fraud is a serious crime that can result in hefty fines and even imprisonment. In the bustling city of New York, where insurance policies are a common part of everyday life, fraud can be particularly prevalent. As a result, it’s important to understand the different types of insurance fraud and how to prevent them. In this article, Eastcoastlaws.com be answering some frequently asked questions about insurance fraud in New York, including what it is, how it can be detected, and the potential consequences of committing this crime. Whether you’re a resident of New York or just curious about the topic, this guide will provide valuable insights into the world of insurance fraud in the city that never sleeps.
What Is Insurance Fraud?
When a person or group deliberately misleads an insurance provider to get funds or benefits to which they are not legally entitled, this is known as insurance fraud. False claims, exaggerated damages, and staging accidents and occurrences are a few examples of insurance fraud.
What Are the Specific Insurance Fraud Offenses?
Section 176 of the New York Penal Law lists 12 distinct insurance fraud offenses, including life settlement fraud in the fifth, fourth, third, second, and first degrees as well as insurance fraud in the fifth, fourth, third, and second degrees. Of these 12 crimes, two are misdemeanors and the other ten are felonies.
How Is Insurance Fraud Prosecuted In New York?
Insurance fraud is a serious crime in New York, and individuals who are found guilty of insurance fraud can face severe penalties, including fines, restitution, and imprisonment. The New York State Department of Financial Services (DFS) is responsible for investigating and prosecuting insurance fraud in the state.
How Are the Insurance Fraud Offenses Different From Each Other?
The quantity of money involved is the primary distinction between fifth, fourth, third, second, and first-degree insurance fraud. Fifth-degree insurance fraud is a misdemeanor. It entails knowingly and purposefully carrying out an act to mislead an insurance provider, such as filling out an insurance application with substantially false information. Insurance fraud in the fifth degree is a class A misdemeanor. Even though it is a misdemeanor and not a felony, it is still crucial that you consult with a knowledgeable insurance fraud lawyer in New York as you could still spend up to a year behind bars if found guilty.
If you obtain or attempt to obtain property worth more than $1,000 as a result of the fraudulent act, the insurance fraud allegation will be upgraded to insurance fraud in the fourth degree, a class E felony. The maximum sentence for conviction is 4 years in prison. Property worth more than $3000 is involved in third-degree insurance fraud, a class D felony, whereas property worth more than $50,000 is involved in second-degree insurance fraud, a class C felony. Insurance fraud in the first degree is the most serious type of fraud. It entails committing fraud that leads to you acquiring or attempting to acquire property valued at more than $1 million. It is a class B felony punishable by up to 25 years in jail.
Aggravated insurance fraud is a separate type of insurance fraud offense. This is intended to deter repeat offenders who commit insurance fraud. You will be charged with aggravated insurance fraud in the fourth degree, a class D felony that carries a term of up to 7 years in prison, if you conduct insurance fraud after being convicted of insurance fraud in the previous 5 years.
What Is The Penalty For Insurance Fraud In New York?
The penalties for insurance fraud in New York vary depending on the severity of the offense. Individuals who are found guilty of insurance fraud can face fines of up to $100,000 or more, as well as imprisonment for up to 15 years or more. In addition, individuals who commit insurance fraud may be required to pay restitution to the insurance company or the victims of the fraud.
What Are Some Common Types Of Insurance Fraud?
There are many different types of insurance fraud, but some of the most common include:
- Health insurance fraud, which involves submitting false claims or obtaining medical services that are not medically necessary.
- Auto insurance fraud, which includes staging accidents, exaggerating injuries or damages, and submitting false claims.
- Homeowner’s insurance fraud, which involves submitting false claims for property damage or theft.
- Workers’ compensation fraud, which includes submitting false claims for workplace injuries or disabilities.
How Can Individuals And Businesses Protect Themselves From Insurance Fraud?
There are several steps that individuals and businesses can take to protect themselves from insurance fraud. These include:
- Being aware of common types of insurance fraud and how they are committed.
- Being cautious when purchasing insurance policies and reviewing the terms and conditions carefully.
- Keeping detailed records of all insurance claims and payments.
- Reporting any suspicious activity to the insurance company or the DFS.
What Should I Do If I Suspect Insurance Fraud?
If you suspect insurance fraud, it is important to report it immediately to the insurance company or the DFS. You can also report insurance fraud anonymously through the DFS website or by calling the DFS Fraud Hotline at 1-800-342-3736.
How Are The Life Settlement Fraud Offenses Different From Each Other?
Performing an act connected to a life insurance contract or the payment of a life insurance settlement is referred to as life settlement fraud. The amount of money involved is the primary distinction between fifth, fourth, third, second, and first-degree life settlement fraud, a New York insurance fraud attorney will explain, just as it is with the insurance fraud crime.
- Life settlement fraud in the fifth degree. The property involved in the fraud is over $1 million. It is a class A misdemeanor with a possible sentence of a year in jail.
- Life settlement fraud in the fourth degree. The property involved in the fraud is over $25,000. It is a class E felony with a possible sentence of up to 4 years in prison.
- Life settlement fraud in the third degree. The property involved in the fraud is over $50,000. It is a class D felony with a possible sentence of up to 7 years in prison.
- Life settlement fraud in the second degree. The property involved in the fraud is over $100,000. It is a class C felony with a possible sentence of up to 15 years in prison.
- Life settlement fraud in the first degree. The property involved in the fraud is over $1 million. It is a class B felony with a possible sentence of up to 25 years in prison.
Aggravated life settlement fraud involves committing life settlement fraud after being convicted of life settlement fraud in the prior 5 years. It is a class D felony that carries a sentence of up to 7 years in prison.
What Is Auto Insurance Fraud?
When someone lies to an insurance provider in order to gain financial advantage, this is known as auto or car insurance fraud. Staged accidents, fake reports of stolen automobiles, claims for damage that already exists, and lying about who was driving the car at the time of the accident are a few examples of auto insurance fraud. By pocketing the money and failing to set up the policies, agents can also be complicit in insurance fraud by leaving the driver without insurance.
What Is Life Insurance Fraud?
When a person gives an insurance company a false statement in order to get life insurance coverage or to make a claim on a policy, life insurance fraud has taken place. Intentionally giving incorrect information to obtain a reduced rate during the application procedure is fraud. Fraud also includes killing someone in order to collect on a life insurance policy. Both murder and insurance fraud charges would be brought against the defendant. Additionally, the policy’s benefits would not be collectible by the individual.
What Are The Consequences Of Committing Insurance Fraud?
The consequences of committing insurance fraud in New York can be severe, including fines, restitution, and imprisonment. In addition, individuals who commit insurance fraud may also face civil lawsuits and damage to their reputation and professional standing.
Can I Be Held Liable For Insurance Fraud If I Unknowingly Participated In The Fraud?
Individuals who unknowingly participate in insurance fraud may still be held liable for their actions. It is important to carefully review all insurance claims and payments to ensure that they are accurate and truthful.
How Long Does It Take To Investigate Insurance Fraud In New York?
The length of time it takes to investigate insurance fraud in New York varies depending on the complexity of the case and the availability of evidence. Some cases may be resolved quickly, while others may take several months or even years to investigate and prosecute.