In cooperation with the Hillsborough (Florida) County Sheriff’s office, which is spearheading the program with assistance from the Florida Department of Insurance Fraud and the National Insurance Crime Bureau (NCIB), Direct General Insurance, among other auto insurers, have partnered to enforce “Operation Crash for Cash,” a joint probe into accident fraud that has resulted in more than fifty arrests so far.

In the eight months of the program’s operation there have also been investigations of four medical clinics, and the charges filed by authorities have included racketeering, the staging of car accidents, and insurance fraud.

According to Direct General’s representatives, this operation serves to underscore the insurers “zero tolerance” policy toward fraud, as well as its efforts in partnering with law enforcement agencies.
Direct General’s Chief Claims Officer, Jim Sclafani, told the press, “Particularly in Central Florida, where the number of staged auto accidents is soaring, Direct General will continue to invest in corporate resources and explore new ways to collaborate with law enforcement agencies to help combat auto insurance fraud. Reducing fraudulent claims is a key aspect in keeping auto insurance rates down for honest drivers.”

Auto insurance companies in Florida say that it is escalating losses from fraud that has forced them to charge higher premiums and institute stricter underwriting guidelines, which, in turn, has impacted both the availability and affordability of car insurance coverage for drivers in the “Sunshine State.”

Sclafani said that as the fraudsters have moved north from South to Central Florida, his company has increased its fraud detection training for claims personnel and adjusters, and boosted resources in its Special Investigations Unit.

Currently, Florida is America’s center for organized insurance fraud, who purposely crash vehicles and falsely report injuries from car accidents. As well “injured” drivers and passengers seek treatment from shady medical facilities which file false insurance claims in order to max out the mandatory $10,000 Personal Injury Protection (PIP) coverage that all Florida drivers must carry. The members of such crash rings typically benefit by sharing the insurance money they’ve fraudulently obtained.

While no legitimate injuries were caused by fraudsters who were identified in Operation Crash for Cash, authorities have estimated that insurance companies would have been billed about $18 million due to fake injuries and claims. More than 27% of all staged accidents nationwide, in the first half of 2009, happened in Florida.

Florida’s drivers already pay among the highest auto insurance premiums in the U.S. Without programs like Operation Crash for Cash, this will only continue.