State legislators last week introduced SB 45, a bill adding insurance application fraud to the criminal code. Under the law, submitting fraudulent, misleading, or incomplete information on an insurance application with the intent to defraud an insurer would be a Class A misdemeanor, increasing to a Class G felony if the value of benefits wrongfully obtained exceeds $1,000.
The legislation was introduced at the request of the Department of Insurance (DOI), which claims that instances of insurance application fraud have increased in recent years. Notably, the legislation does contain a section specifically addressing application fraud committed by insurance producers:
A person is guilty of application insurance fraud when, with the intent to injure, defraud, or deceive any insurer the person “makes false or fraudulent statements or representations on or relative to an application for an insurance policy for the purpose of obtaining a fee, commission, money, or other benefit from any insurers, agent, broker, or individual.” [emphasis added]
IA&B is closely monitoring this legislation and will be working with the DOI and legislators to ensure that the language affecting agents is not overly broad.
Need additional information?
Contact IA&B Government Affairs Director John Savant at 717-918-9214 or JohnS@IABforME.com.
