State Makes Insurance Fraud a Priority

Updated: 02/13/2013 11:02 PM KSTP.com By: Nick Winkler

Commerce Commissioner Mike Rothman held an insurance fraud roundtable Wednesday. It follows a legislative hearing and is part of Insurance Fraud Awareness Week.

Organized crime rings with ties to eastern Europe are targeting Minnesota due to what insurers call an outdated law. Fraudsters are exploiting the state's no fault insurance law, which allows accident victims generous medical benefits regardless of fault.

The scam plays out like this: Fraudsters stage car crashes, partner with shady medical providers, and over bill insurers which are obligated to pay full price for services that are either not needed or never rendered.

Analysts say the scam drives up the cost of auto insurance and adds, on average, about $100 a year to your bill.

Wednesday's roundtable brought together industry representatives, law enforcement, and state agencies. The goal is to cooperate better and reduce the fraud.