Auto insurance fraud under attack in California following $1.3 million grant

California Auto Insurance
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A Contra Costa district attorney has directed the funds toward an aggressive effort.

According to the district attorney in Conta Costra, California, officials will now be establishing an investigation into workers’ compensation, disability, health care, and auto insurance fraud, with the assistance of a state grant worth $1.3 million.

The announcement explained that these funds will help in both investigations and prosecutions.

California Auto InsuranceThe Contra Costa County District Attorney’s Office, and the California Department of Insurance made the announcement through District Attorney Mark Peterson, saying that the grand money would be used for performing investigations of auto insurance, health care, disability, and workers’ compensation fraud, as well as the prosecution of those involved in it.

The cost to the state from fraud to the auto insurance, disability, and other sectors in the state is massive.

Peterson explained that “Insurance fraud costs California’s honest consumers and business approximately $15 billion per year.” He also added that “The huge financial burden that insurance fraud imposes on the citizens of Contra Costa County through higher insurance premiums and the increased costs of goods and services is unacceptable.”

The funds from Contra Costa County will come in the form of multiple grants in order to fight fraud in several coverage sectors. The battle against urban auto insurance fraud (which stems from organized rings) will receive $273,667. Workers compensation scams will be fought with $604,400. Regular fraudulent acts on coverage policies will be pursued with $458,903.

The funds from the grants will help to pay for the salaries and benefits of a minimum of three prosecutors, as well as three investigators who have been assigned to the workers compensation, disability, health care, and auto insurance fraud units. Peterson said that they will be working along with the California Department of Insurance Fraud Division, as well as additional agencies in the state. Those other agencies include the Contractor State Licensing Board, the Department of Industrial Relations, and the Employment Development Department.

Dave Jones the commissioner in California, signed a replica check at a news conference, calling auto insurance and other forms of coverage fraud a “tremendous drain and drag on our economy.”

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