Insurance Fraud in Washington

You’re driving along on your daily commute when a car pulls in front of you and slams on its brakes.

You want to steer left into another lane, but a second car has appeared at your side. Wham — you rear-end the car in front and you find yourself handing out your insurance information and later paying for the other driver’s medical bills.

Are you and your insurance company being scammed?

According to The Olympian newspaper, Insurance Commissioner Mike Kreidler will request about $2 million in funding from the Legislature to create a five-person insurance fraud unit in his department, which would investigate such “staged accident” rings and other scams.

“It’s clear that we are ranked as one of the more fraud-prone states because we don’t have the resources to investigate and prosecute,” Kreidler said. “We’re going to start small and see how that works, develop a track record.”

In the article Greg Newell, a Fife-based investigator with the National Insurance Crime Bureau, estimates that Washington insurers paid more than $404 million in bogus claims in 2004. Newell says he has advocated for a state fraud unit for five years because it is difficult to get local police to spend time on what are considered white-collar crimes.

“They’re interested in murders; they’re interested in bank robberies,” he said. “They’re interested in crimes against persons. Insurance fraud is pretty far down there on the list.”

“The reason Washington is such a target is because other states do have fraud units,” he said. “We have people here who are operating in organized operations who came from California, came from New York. Those states have insurance fraud units. Even Idaho has a state fraud unit.”