House and Senate approve immunity for insurers investigating fraud.
Harrisburg – Legislation sponsored by state Senator Kim Ward (R-39th) to assist law enforcement in insurance fraud investigations was approved by the House of Representatives today and will be sent to the governor for enactment into law.
Senate Bill 1181 amends the Insurance Company Law to limit the ability of individuals under investigation to bring civil cause of action against an insurer, or its employees, who are assisting law enforcement with the case.
“As with most types of fraud, it’s the law-abiding citizens who end up paying more when individuals commit insurance fraud,” Ward said. “Passage of this legislation gives investigators an important tool to combat fraud by allowing them to work together without the threat of a civil lawsuit.”
The senator noted that referrals of potential fraud to authorities in the first half of 2010 increased 22 percent from the same period in 2009, continuing a two-year trend. 1
“These are difficult economic times and consumers are already coping with rising insurance costs. An increase in insurance fraud only adds to that burden,” said Ward. “This new law will give fraud investigators an opportunity to put the brakes on that trend and provide some relief to law-abiding citizens.”
1 Source: PA Insurance Fraud Prevention Authority, 2nd Quarter 2010 Report www.helpstopfraud.org
Contact: Rob Ritson