Like other states, New York has laws which punish insurance fraud. These laws not only apply to situations where someone is filing a claim but also to certain applications for insurance coverage.
The penalties for insurance fraud are harsh. If the dollar amount in question is more than $1,000, then a person will face a felony charge. In the worst case scenario, a person can face 4 years in prison for this offense.
Additionally, the person will have a felony conviction on her record and will likely have to repay any money she took.
The maximum sentences increase rapidly from that point. If a person takes more than $50,000 by fraud, the person can go to prison for up to 15 years.
There are a number of circumstances a court would consider when handing down a sentence. Someone’s prior record can make a difference as can his willingness to admit responsibility. The fact insurance fraud is not a violent crime also helps.
New York’s insurance fraud laws are broad
The scary thing about insurance fraud laws is how broad they are. Basically, almost any inaccurate statement to an insurance company can end with fraud charges. Even an omission can lead to an insurance fraud charge in some circumstances.
In practice, this means insurance fraud includes a lot more than the most flagrant cases which tend to grab headlines, such as people who burn down homes and businesses in order to collect insurance proceeds.
For example, someone who claims workers’ compensation benefits while still working can face fraud charges.
Likewise, a person who pads an insurance claim by exaggerating an injury or even lies about his commercial driving record just to get a better premium can face a white collar criminal conviction.
Improper billing of health care services to insurance companies is also a type of insurance fraud.
On the other hand, insurance companies and even law enforcement officers may be a little too quick to conclude that a person’s incorrect statements are in fact criminal as opposed to an honest mistake or, at worst, carelessness.
Those New Yorkers who are accused of insurance fraud should understand their legal alternatives early in the process.