Insurance Fraud Never Pays

Please read. It's things like this that continue to keep insurance rates on the rise.

http://calibre.mworld.com/m/m.w?lp=GetStory&id=287293621

Chad Hemenway

Released : Wednesday, January 02, 2008 12:07 PM

Authorities continue to search for two individuals they say took part in an automobile insurance fraud scheme that put about $3.4 million in their pockets, according to court documents.
A federal grand jury in U.S. District Court, Northern District in Pensacola, Fla. handed up a 21-count indictment against Waylon Bryant Gregory and Chrystal Giluso, both of Florida. Arrest warrants were signed late last month.

The indictment charges the couple with fraud, identity theft and illegal use of Social Security numbers.

Gregory is accused of obtaining the personal information of others, using fictitious names and taking out fraudulent driver's licenses, bank accounts and credit card accounts, the indictment says. Using these identities, Gregory also took out auto insurance policies with Progressive, Permanent General Assurance Corp. and Geico companies in the maximum amount allowed.
Gregory allegedly wrecked the insured vehicles, then filed claims for medical expenses, property damage, personal injury protection and uninsured motorist coverage, according to the indictment. When the companies required more information about the claims, Gregory and Giluso gave them more false information.

It is unclear within the indictment how Gregory obtained others' personal information or how many vehicles he wrecked to collect fraudulent insurance payments.

The Insurance Information Institute estimates that fraud accounts for 10% of the property/casualty insurance industry's incurred losses and loss adjustment expenses, or about $30 billion a year. Miami leads a list of cities with the most staged auto accidents, according to the National Insurance Crime Bureau. Orlando, Fla. ranks eighth.

The top five writers of private passenger auto insurance in Florida in 2006, according to A.M. Best state/line data, were: State Farm Group, with a 21.5% market share; Allstate Insurance Group, with 14.3%; Berkshire Hathaway Insurance Group, with 12.7%; Progressive Insurance Group, with 11.2%; and USAA Group, with a 4.4% market share.

(By Chad Hemenway, associate editor, BestWeek: Chad.Hemenway@ambest.com)

Copyright 2008 A.M. Best Company, Inc.