Auto insurance is designed to help those who have experienced physical harm as well as property damage during a vehicle accident and more. There are those who have taken advantage of auto insurance. Some people have submitted false claims for the purpose of getting a payment or providing funds to other payees of an insurance company. This is insurance fraud and it is against the law.
Individuals have committed insurance fraud when they submitted a claim for an injury or property damage that is false, deliberate or exaggerated. It’s also possible for someone to work with others to defraud an insurance company. A physician or auto repair shop and others could raise the cost of their services. They could charge the insurance company for services not listed in the estimate they provided. Some even charge for services they did not perform. Insurance fraud has occurred when organizations and groups have joined together with the purpose of creating injuries and accidents to collect on insurance claims.
In the state of California, there are laws against committing insurance fraud. They are listed in California Penal Code § 548, §549, §550 and §551 PC. In these sections, different types of insurance fraud are described in detail. When someone is being prosecuted, it must be proven they had intent to defraud an insurance company. A prosecutor must establish a defendant’s actions were deliberate and intentional to obtain insurance benefits they would not have otherwise been able to receive. They may prove a defendant was entitled to benefits but intentionally increased their claim to obtain more. A prosecutor may establish a defendant made statements that were false or misleading. They may also show the defendant’s fraudulent behavior changed the outcome of an insurance claim.
California Penal Code Section 548
This makes it against the law for an individual to get rid of their property or the property of another for the purpose of submitting a false insurance claim.
California Penal Code Section 549
This makes it illegal for an individual to refer others to a medical professional or auto repair business for the sole purpose of filing an insurance claim. Chiropractors and other medical professionals have been charged with auto insurance fraud using this section. Other professionals including attorneys and accountants have also been charged with insurance fraud under this section of California law.
California Penal Code Section 550
This section is designed to punish fraudulent insurance claims for personal injury as well as property loss. To be charged under this section, an individual must have intentionally signed documents required for an insurance claim and knowingly provided false information. Under this section, the documents do not need to be presented to the insurance company. It only needs to be proven an individual prepared the documents with the intent to provide an insurance company with false information. An individual could also be charged under this section if they intentionally staged an accident to submit a false insurance claim. People have also been found guilty under this section for claiming to reside in one place for lower insurance rates but actually living in an area that would require them to pay higher insurance rates.
California Penal Code Section 551
This section is used against auto repair shops or car dealers who provide money, or an established commission, for referring someone to their business.
The punishment given to individuals convicted of insurance fraud is severe. Should someone in the medical or legal profession, like a physician or a lawyer be convicted of insurance fraud, the penalties would be more serious than people in other professions. A lawyer or physician may lose their professional licenses. In California, auto insurance crimes are classified as wobblers. This means a prosecutor can file misdemeanor or felony charges against an individual accused of insurance fraud.
If a person is convicted of misdemeanor insurance fraud, they could be incarcerated for up to twelve months. They could be given a fine in addition to being incarcerated. An individual will be required to serve formal probation as well as lose their professional license should they have one.
If a person is convicted of a felony charge of insurance fraud, they could be incarcerated for up to five years. After this time, they will be placed on formal probation. An individual could also be given a fine of up to $10,000. A court could also require them to pay full restitution. In some cases involving members of the medical profession, the restitution required to be paid could amount to millions of dollars.
Being arrested and charged with insurance fraud is a serious situation. One of the essential elements associated with obtaining a conviction is proving the defendant’s actions showed intent to defraud. It’s possible a person could make unintentional mistakes that led to charges of insurance fraud. This is a situation where an experienced attorney can make a difference. They will know how to show the court their client made an unintentional error and did not commit insurance fraud. An attorney will know how to protect their client’s rights during the entire process.
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