NYC’s High Manhattan Insurance Fraud Rate

Do you ever wonder what factors determine your Manhattan insurance premiums? As a New York City resident, it’s likely that insurance fraud is a significant factor. According to a recent study by the Insurance Research Council (IRC), New York City has an exceptionally high number of fraudulent claims. Findings from the study suggest that one in five no-fault insurance claims had elements of fraud and one in three no-fault claims showed evidence of inflation in 2010.

No-fault insurance means all parties who suffer losses in a car accident receive immediate financial reimbursement by their respective insurance companies, regardless of who is at fault. The victim will receive a pay-out from their insurance company, while the insurance company of the liable driver will pay back the victim’s company.

The IRC study, called New York’s No-Fault System: Preliminary Findings From Closed Auto Injury Claims, reveals a worrying trend of health care professionals defrauding the system. A common example of insurance fraud abuse would be a doctor billing an insurance company for medical treatment that was not administered, or exaggerating the extent of an injury to charge higher fees.

The overall result of insurance fraud is that anyone with a Manhattan insurance policy is paying more for the cost of fraudulent activities through higher premiums. Hopefully increased awareness generated by organizations such as the IRC concerning the implications of insurance fraud can help to reduce the level of fraud and keep premiums lower for everyone.

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