From 2010 to 2012, the number of Florida questionable claims (QCs) logged by National Insurance Crime Bureau (NICB) member companies increased 23 percent, according to a new report from the Des Plaines, Ill.-based nonprofit organization. Perhaps the most alarming finding is the dramatic 55-percent surge in QCs in southern Florida during that time, with the Miami metro area leading the state.
If an NICB member company deems a claim suspicious—as in it meets the criteria of a QC—it submits that claim to the NICB for closer review and investigation. In order for this to happen, a QC must exhibit one or more indicators of possible fraud. A single claim may contain as many as seven referral reasons. This most recent report analyzes QCs by loss city, core-based statistical area (CBSA), policy type, loss type, policy and loss type combined and referral reasons.
Hotbeds of Suspicion
In 2010, NICB found that a total of 8,723 Florida QCs were referred for closer examination. In 2011, that number increased to 9,670, only to rise yet again in 2012 to 10,693. This represents an increase of 23 percent compared to the 2010 figure. The top five cities in Florida generating the most QCs last year were: Miami (2,309); Orlando (877); Tampa (690); Jacksonville (637) and Hialeah (361).
The top five CBSAs reporting QCs were Miami-Fort Lauderdale-Pompano Beach, Tampa-Saint Petersburg-Clearwater, Orlando-Kissimmee-Sanford, Jacksonville and Cape Coral-Fort Myers. It should come as no surprise that a state riddled with staged accidents and shady clinics reported a large number of PIP-related suspicious claims. In fact, the most frequent loss types were: personal injury protection (PIP), bodily injury, other automobile, collision, and property damage.
The NICB notes that QCs represent a fraction of overall claims traffic. Nationally in 2012, QCs totaled 116,268 out of an overall claims population of more than 70.5 million—or 0.164 percent. The volume of QC referrals can increase or decrease over a given period of time, depending on a number of factors, including better reporting by the industry and fluctuations in fraudulent activity.
South Florida easily led the state in QCs in 2012, with 4,686—up 4,349 reported in 2011 and 3,033 in 2010. The Tampa Bay area came in second, at 1,260, although QCs there have declined by 39.4 percent over the past two years. Miami-Dade County led the state with 3,530 questionable claims in 2012, followed by Orange County at 1,097, Hillsborough County at 983, Broward County at 929 and Palm Beach County at 755.
There were 43 loss types identified in the 2010 QC data; 45 loss types identified in the 2011 QC data, and 41 loss types identified in the 2012 QC data. PIP was the loss type with the most QCs in each of the 3 years: they increased 24 percent between 2010 and 2011, and then 10 percent between 2011 and 2012. The percentage of PIP-related QCs compared to the total number of Florida QCs increased from 37 percent in 2010, to 41 percent in both 2011 and 2012. The top three loss types were the same in each of the 3 years.
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