Almost everyone has seen a movie where the owner of a certain establishment attempts to burn down their building in order to receive an insurance payout. What many people don’t realize, however, is that these types of things really do happen every day; and as such, are one of the most obvious types of insurance fraud.
California defines several instances that constitute insurance fraud and lays out the penalties that counties must abide by when enforcing sentences. Anyone accused of insurance fraud faces severe consequences, so it is in their best interest to secure a lawyer as soon as possible.
What Constitutes Insurance Fraud?
California PC 548-550 outlines the many definitions and rules regarding the possible charges of insurance fraud. The first mention of insurance fraud is when a person willfully damages or destroys some form of property that is insured, with the express purpose of gaining an insurance payoff. The law goes on to mention a long list of crimes that include falsely filing a claim, filing multiple claims for one event, participating in a car accident that was expressly planned for insurance fraud and knowingly preparing a false claim. The rules against filing and preparing fraudulent or multiple claims also apply to medical insurance coverage.
The law also states that it is illegal to withhold information from an insurance company that would affect a person’s eligibility. Making an oral or written statement that is false with the intent that it is to be reviewed by an insurance company is also an offense. It is also illegal for a company or partnership to refer, solicit or accept any business from an entity that the company knows has participated or intends to participate in any of the fraudulent insurance activities previously mentioned.
Insurance fraud is a bailable offense and is included in all California county bail schedules. These schedules can be used to secure a person’s release within a few hours of arrest. Some counties have bail amounts that are the same. Santa Barbara and Los Angeles Counties, for instance, both set bail for insurance fraud at twenty-five thousand dollars. If the amount of money stolen is higher than twenty-five thousand dollars, then the bail amount will be equivalent to the amount stolen. Santa Clara County, on the other hand, only sets its bail at ten thousand dollars. Bail across the state of California varies, so a quick call to your closest Bail Hotline office will assure you of the preset bail for your specific charges, as well as a near immediate release at just a fraction of the total bail amount.
Penalties and Consequences
The additional penalties related to insurance fraud can vary as much as the bail amounts between counties. A person who willfully destroys property for insurance gain, for instance, can face up to five years in prison and a fine of fifty thousand dollars. A person with a prior conviction, however, will face far more severe consequences; each prior conviction will bring a sentence enhancement of two years added to a person’s initial sentence.
A person who files or prepares a fraudulent insurance document, or participates in intentionally crashing a car for insurance purposes, also faces a five-year sentence and a fifty thousand dollar fine. Filing a false claim regarding health insurance, however, only brings the possibility of one year in jail.
Making false written or oral statements in an effort to defraud an insurance company is another instance that can bring five years in prison. Many of these crimes also involve other sentence enhancements of more than two years, if prior convictions exist. Even knowingly referring or accepting the business of a person that participates in insurance fraud can bring up to a year in county jail.
Insurance fraud is considered a very serious offense in the State of California. In most instances it is treated as a felony and punishable by excessive fines and at least half a decade in state prison. Even though insurance fraud is not a violent crime, it will land a person in prison with hundreds of violent offenders. Anyone accused of insurance fraud definitely will want an experienced lawyer on their side.