Individuals and organizations can both be charged with insurance Fraud. Individuals and businesses can commit insurance fraud in the process of making a claim or completing an application for personal or business insurance, Insurance agents and brokers can be charged with fraud in the course of selling insurance, and applicants for an insurance license can be charged with fraud in the course of becoming licensed agents.

Cost of fraud

According the the Federal Bureau of Investigation, The total cost of insurance fraud (non-health insurance) is estimated to be more than $40 billion per year. That means Insurance Fraud costs the average U.S. family between $400 and $700 per year in the form of increased premiums.

Texas Penal Code and Insurance Fraud

A person can be charged with insurance fraud if that person, with intent to defraud or deceive an insurer, and in support of a claim for payment under an insurance policy prepares or causes to be prepared a statement that is knowingly false or misleading, presents it to the insurer or causes to be presented a knowingly false or misleading statement.

Additionally, a person commits an offense if the person, with intent to defraud or deceive an insurer and in support of an application for an insurance policy prepares or causes to be prepared a knowingly false or misleading statement, or presents or causes to be presented a knowingly false or misleading statement.

Finally, A person commits an offense if, with intent to defraud or deceive an insurer, the person solicits, offers, pays, or receives a benefit in connection with the furnishing of goods or services for which a claim for payment is submitted under an insurance policy.

The punishment range for these offenses is based on the value of the claim, ranging from a Class C misdemeanor ($100 or less) to a first degree felony ($300,000 or more).

If a person is convicted of insurance fraud, the court shall order the defendant to pay restitution, including court costs and attorney’s fees, to an affected insurer.

In defending claims of insurance fraud, if we can show that a portion of the claim for payment under an insurance policy resulted from a valid loss, injury, expense, or service covered by the policy, then the value of the claim is equal to the difference between the total claim amount and the amount of the valid portion of the claim.

Insurance Fraud under the Texas Insurance Code

Under the Texas Insurance Code, Insurers, agents, and insureds can all face various penalties for insurance Fraud, deceptive trade practices and improper business practices. Penalties range from criminal penalties, to administrative penalties, to fines and sanctions. Agents facing an insurance fraud investigation need the assistance of an experienced attorney to guide them through the process.

Austin Insurance Fraud attorney Rhett Braniff is a former insurance agent. He has a broad understanding of the intersection of the insurance practice and the criminal justice system. Contact Rhett Braniff today to learn how he can assist you with your case.