May | June 2010 LEGISLATIVE NEWS Prevent insurance


The ACFE (Association of Certified Fraud Examin- ers) estimates the average U. S. organization loses about six percent of gross revenue to all forms of oc- cupational fraud and abuse. On a national basis, these offenses cost $400 billion annually.


Insurance fraud occurs when a person provides false or misleading information to an insurance company; fails to provide relevant information concerning a policy or a claim; or tries to receive money that they are not entitled to under a policy. Fraudulent claims are one of the factors that drive the cost of premiums up for both employers and employees.


Fighting Fraud


Improving basic internal procedures and demonstrat- ing that you have a full understanding of how your business is operating under your insurance coverages may result in lower premiums.


Workers’ compensation and fleet are two areas of high concern for occupational fraud and abuse.


Fleet Fraud


For any business operating vehicles under a fleet mo- tor insurance policy, it is important to demonstrate to an insurer that adequate fleet procedures are in place to minimize costly risks – including occupational fraud.


Fleet management programs that include a fleet safety policy are most successful when the following areas are addressed:


• Management commitment • Written policies and procedures • Driver agreements • Motor Vehicle Record checks • Crash reporting and investigation • Vehicle selection, maintenance and inspection • Disciplinary action system • Reward/incentive program


F R A U D


Workers’ Compensation Fraud How can you tell if a workers’ compensation claim is false? There is no sure-fire way to identify WC fraud without proof, but there are red flags:


• Accidents reported on Fridays or Mondays • Late reporting • New employee • No witnesses


• Conflicting descriptions • Unusual coincidence • Suspicious providers


If two or more of these red flags are identified, you should take action by contacting your agent or carrier immediately.


Developing Programs It’s important to note that relatively few occupational fraud and abuse cases are discovered through routine audits; most instances are reported by fellow employ- ees. Do you have the proper reporting procedures in place? If not, our team of P&C experts has the re- sources to assist you in developing the policies and programs you need to minimize your exposure to occupational fraud and abuse to protect your bottom line.


Reporting Fraud


Insurance fraud is theft. Many states require insur- ers to report all instances of fraud to law enforcement authorities. If you suspect fraud, you should contact your insurance agent, your claims adjuster or the Na- tional Insurance Crime Bureau at 1-800-TEL-NICB.


About Us BB&T Insurance Services is one of the region’s most experienced insurance brokerage consulting firms. Our Property and Casualty Group represents a full ar- ray of P&C insurance carriers. Their knowledge and experience have earned the trust of many small and large firms throughout the area.


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