South Florida is a wonderful place to live. However, we are not without our fair share of criminals looking to take advantage of residents. One serious illegal activity that continues to affect our clients directly is PIP fraud. “PIP fraud” is a term law enforcement uses to categorize crimes against Florida’s auto insurance laws.
Personal injury protection insurance, or PIP, pays for your medical treatment following an auto accident, regardless of who is at fault for the crash. PIP fraud generally relies on insurers paying fake or false medical claims under PIP law.
A typical scheme works like this: You get into a bad enough accident that the police are called, or your car is inoperable and towed. Your personal information is obtained by someone called a “runner” who contacts you and offers to help you get treatment. If you tell them you’re not injured, the caller may entice you with a cash payment to visit a specific clinic or medical center anyway, with the promise of more when the “case” is over.
The medical clinic then employs a crooked personal injury lawyer to file a claim against your insurance company for the PIP dollars. Because the state minimum of required PIP insurance is $10,000, that’s often the limit to how much the lawyer is willing to obtain. Everyone gets paid with the PIP money – the runner, the doctors, and the lawyer – and you as the victim are offered very little, if any, from the funds.
The sad truth of this illegal scheme is that these criminals are basically stealing your PIP insurance proceeds from you, and keeping it for themselves. So what part of this is illegal, exactly? For one, contacting an auto accident victim in any way (by phone, text, email, or in person) to solicit them for medical treatment or legal representation is illegal in the state of Florida.
Another crime occurs when the “runner” tries to bribe you, the victim, with a cash payment for going to their clinic of choice. While all these crimes are serious offenses, it’s the insurance fraud scheme that you should be most concerned about. By falsifying or exaggerating injuries and treatment related to an auto accident, these people are committing felonies.
Depending on the scope and size of the criminal ring, these financial crimes are punishable by several decades in prison, and millions of dollars in restitution and legal fines. How does this affect you, the auto accident victim?
First, these criminals are taking advantage of your unfortunate circumstance, and your lack of knowledge on how the PIP system works. Their goal is to steal as much of your insurance money as possible. They ignore your legal rights, including the right to privacy. They don’t care about you – they only want to use you.
As if that wasn’t enough to upset you, here’s something else they are responsible for: increasing auto insurance rates. Florida’s auto insurance companies have been raising rates on their customers for years in part due to increases in PIP fraud. Though disputed, the Florida Office of Insurance Regulation says that PIP fraud cost insurers close to $1 billion from 2010-2012, the most recent period in which insurance audits were available. That equates to about $250 per family a year in higher auto insurance costs. The insurers say they have no choice but to pass these additional costs on to customers.
What can you do to help in the fight against PIP fraud?
Report suspected insurance fraud to the Department of Financial Services at 1-800-378-0445. You may be eligible for a reward for the successful prosecution of your tip.