The sour economy is producing a bumper crop of cash-strapped consumers, business owners and shady agents who’re fueling a wave of insurance fraud that’s keeping regulators and law enforcement officials busy from coast to coast.
Whether it’s worthless health plans peddled by fax, staged auto accidents, arson or slip-and-fall accidents at the local mall, insurance fraud of all kinds is booming in the recession and consumers are paying the price in higher premiums.
To keep it in perspective, roughly 48 million insurance claims are made each year in the U.S. and less than one-quarter of 1 percent are referred to the nonprofit National Insurance Crime Bureau for investigation of possible fraud.
Last year, that amounted to just more than 85,000 questionable claims. That was up 14 percent from nearly 75,000 in 2008, however.