April 5, 2005 – B.C. motorists saved more than $70 million in 2004 thanks to ICBC anti-fraud programs, according to year-end figures. The figure is based on the estimated value of fraudulent claims which were denied, money recovered and savings generated through fraud prevention.
“It is not acceptable to ICBC to sit back and simply pass the cost of fraud onto our customers,” said Mark Withenshaw, ICBC vice president of loss management. “We invest in fraud prevention because less fraud helps keep rates low and stable for our customers.”
ICBC’s anti-fraud efforts led to 84 criminal charges against 56 people last year, with 61 convictions being obtained to date.
ICBC also continues to focus on filing civil suits to recover money paid out on fraudulent claims and billings. The use of civil litigation also allows ICBC to ask the courts to impose punitive damages against those found guilty of fraud.
The Canadian Coalition Against Insurance Fraud estimates that up to 15 per cent of insurance claims are either exaggerated or fraudulent. ICBC estimates that fraud costs each of ICBC’s 2.8 million policyholders $150 per year.
Much of the success in catching people trying to defraud ICBC is based on information the Corporation receives through its anonymous tip line. Anyone with information on a suspicious, exaggerated or fraudulent claim is encouraged to phone 604-661-6844 or 1-800-661-6844.
Insurance fraud can appear in many ways, ranging from organized gangs that stage fake crashes to individuals who lie about their injuries. Here are three actual stories from ICBC’s fraud files.
Motorcyclist wipe out caught on the net
“Pam” had filed an injury claim with ICBC as the result of collision she was involved in. The Claims Adjuster working on her file saw some inconsistencies in “Pam’s” story and brought in investigators to take a closer look. Knowing she was an avid motorcycle rider, they searched the internet and the search found over 1000 postings on an internet chat room designed for motorcycle enthusiasts.
The content of her messages contradicted much of what she told her adjuster about her injuries and disabilities.
The investigation led to a large reduction in what would have been a fairly significant injury claim.
The Tooth Fairy Delivers
“John” claimed his teeth were damaged in a motor vehicle collision. His dentist supported the claim and submitted a $1,500 estimate to ICBC.
A claims adjuster noticed the dentist’s clinical records were not in chronological order, so she called in investigators.
It is alleged that the dentist confirmed the injury was motor vehicle related and suggested it was his assistant who made the clinical record mistakes. A follow up interview with the assistant proved invaluable as she confirmed the customer’s teeth were damaged prior to the collision.
ICBC denied the claim. The customer sued. After two days of trial, the dentist was discredited and the customer abandoned his suit.
A lawsuit was launched against the dentist and the dentist had to pay ICBC over $25,000.
False declaration leads to costly breach
When “Jim” moved to BC he provided ICBC with a letter outlining his insurance history in order to obtain a discount on his insurance policy. It was later revealed that the discount letter was false. In fact, it was obtained from a company that had nothing to do with automobile insurance.
“Jim” had presented the authentic looking document to ICBC and saved money on his insurance. Six months later one of “Jim’s” family members struck a pedestrian resulting in serious injuries.
The pedestrian’s file settled for about $1 million.
Because of the false letter, “Jim” is in breach of his policy of insurance with ICBC, and therefore ICBC will be looking to recover the entire settlement cost from him. While the false letter may have temporarily saved “Jim” money on his policy, the misrepresentation may cost him far more.
Learn more at www.ibc.ca.Tags: Coalition Against Insurance Fraud, fraud, Insurance Bureau of Canada (IBC), Insurance Corporation of British Columbia (ICBC)