Florida Gov. Scott Talks insurance Fraud
in his state of the state address on Jan. 10, Florida Governor Rick Scott laid out the case for auto- insurance reforms that would
crack down on fraud abuse in the state’s
no-fault system.
He says fraud is “estimated to cost Flo-
ridians $900 million. If we do not act,
the Office of Insurance Regulation
(OIR) predicts that costs for con-
sumers will continue to spiral out of
control.”
Scott asserts that pure premium
costs increase about 30 percent
“year after year” and that these costs
“are being driven up every day all
around our state by scams that are
ultimately paid for by Florida’s working
families.”
“If we are going to be serious about
keeping the cost of living low for Florid-
ians we must get tough on the fraud and
abuse in the auto insurance system,” he
adds. “It is the consumers in our state
that we must protect, not trial lawyers or
those involved in these schemes. Florid-
ians cannot afford another year of this
fraud and abuse or the cost that will come
with it.”
In November 2011, Scott and Florida
CFO Jeff Atwater outlined four steps to
reform the state’s no-fault law, first en-
acted in the early 1970s, which requires
drivers to have PIP that provides $10,000
in coverage per person for medical bills,
regardless of fault in an accident.
The proposal included measures to
prevent fraud, and reform the role attorneys and medical providers play in the
PIP system.
A report on the no-fault law in Florida
published by the National Association of
Mutual Insurance Companies says the
state’s lawmakers have “always seemed a
step behind trying to combat the latest
healthcare tactics,” resulting in “runaway
increases in PIP costs.”
For years the industry has alleged fraud
by the state’s healthcare clinics, along
with outrageous attorneys’ fees and
organized staged-accident rings to
take advantage of holes in the sys-
tem. The Property Casualty Insur-
ers Association of America (PCI)
asserted in an October 2011 special
report on Florida’s no-fault system
that false claims have cost the state’s
drivers more than $800 million.
Furthermore, the National Insurance
Crime Bureau (NICB) has said that Flor-
ida led the U.S. in staged motor vehicle
accident “questionable claims” between
2007 and 2009. Four out of the 10 U.S.
cities with the highest rate of question-
able auto claims are in Florida. —By
Phil Gusman, PropertyCasualty360.com
SPeaKiNG OF EDuCATioN-DRivEN BuSiNESS RESuLTS
With Donna J. Popow, Sr. Director of Knowledge
resources and ethics Counsel, The institutes
The 80/20 rule is a common saying in insurance. It refers to the
theory that about 20 percent of insureds generate 80 percent of
claims. When dealing with too many “worst case scenarios,” however, claims professionals can develop a myopic view of insureds.
This is where formal and hands-on learning come into play. Donna
J. Popow, Esq., CPCU, AIC, explains how education helps cultivate
a better understanding of claims handling and the business overall.
She also says that striking a balance between hectic workloads and
professional development is easier than one might think.
Claims professionals often report being overworked. How
attainable is education and specialized training in this
pressure cooker environment?
I started in claims in 1977 and I don’t think a year went by that we
weren’t complaining of being overworked. Having said that, I do
think the change in the way claims are handled has put an increased
burden on file handlers in terms of file documentation and additional
reporting and data entry work. So I can empathize with overworked
claims personnel and acknowledge that companies are doing more
with less. It is always debatable as to whether claims organizations
have ample resources.
So you are saying that development
falls into essentially three distinct
groups?
Yes. It’s common for insurers to build in a
professional development plan in an employee’s performance review. The bottom
line is that if you have any ambition in making insurance a career,
you are going to have to find the time to do this so hopefully you
and your employer can come to an agreement as to when that time
will be reserved. For instance, you may need to find a way to carve
out two hours of study time with the employer giving the student
one hour from work and the student giving up one hour of free time,
say at lunch.
G “i don’t think classroom
instruction is going away,
but what we will find is that
it is reserved for certain
types of topics that require
more hands-on learning,”
Popow says.
