Missouri Insurance Fraud Laws

In Missouri, insurance fraud can occur in many different ways. An insurance fraud offense typically occurs when someone tries to make money from an insurance transaction through lies or deception. Insurance providers can also violate insurance laws in many ways, including misrepresentation in sales and inappropriate cancellation or denial of coverage. Examples of insurance fraud include:

  • Workers' Compensation: An employee claims to have suffered an injury while on the job and either didn’t suffer an injury at all, or was injured while doing something not work related. Employers can also commit workers' compensation fraud by understating their number of employees or the type of work they do.
  • Property Fraud: Someone exaggerates the amount of damage incurred to their home, car, or other possession; deliberately damages their possessions for reimbursement by the insurance company; or seeks reimbursement for a lost or stolen item that was neither lost nor stolen.
  • Casualty Fraud: Someone fakes or exaggerates an accident or injury to receive money from an insurance company.

Who Enforces and Prosecutes Insurance Fraud Laws?

Missouri state and local prosecutors handle insurance fraud cases under the criminal and insurance codes. When insurance companies or agents act illegally or unprofessionally, the matters can also be handled administratively by the Missouri Department of Insurance, Financial Institutions, & Professional Registration (DIFP), for example by revoking a license or imposing a fine. The federal government can also prosecute insurance fraud under a number of federal criminal laws, such as mail fraud or racketeering.

How Do I File a Complaint Against an Insurance Company?

The following table highlights the main provisions of Missouri's insurance fraud laws.

Code Sections

Missouri Revised Statutes (MRS) Title 24 - Business and Financial Institutions

MRS Sections 569.100 and 569.120 - Property Damage

  • Property damage in the first degree prohibits causing property damage over $100,000 to defraud an insurer
  • Property damage in the second degree prohibits damaging property to defraud an insurer

What is Prohibited?

For consumers: Knowingly lying about or concealing an important fact in connection with an insurance claim or payment made under an insurance policy or damaging property to reap insurance benefits.

For insurance providers: Issuing fake insurance policies, rate-fixing, misrepresenting insurance when selling it, denying compensation for covered incidents, operating an insurance company in bad faith, etc.

Penalties

Possible criminal penalties include jail time, fines, and restitution. Possible civil penalties including fines, cancellation of your insurance policy, and revocation of insurance or professional license.

For example, the crime of property damage to defraud an insurer of over $100,000 is a Class D felony subject to prison for up to 4 years and a fine of up to $5,000 On the other hand, property damage to defraud an insurer of less than $100,000 in damage is a Class B misdemeanor punishable by up to 6 months in jail and a maximum $500 fine.

For insurance providers, violations can be criminal with various misdemeanor or felony repercussions. Civil insurance provider violations are classified from Level 1 to 5 (with 5 being the most severe) based on the seriousness of the bad conduct. In an administrative proceeding, a person or company can be required to pay for each violation up to $1,000 for Level 2, $5,000 for Level 3, $10,000 for Level 4, and $50,000 for Level 5 violations or $250,000 per year for multiple violations. If imposed by a court proceeding, penalties can increase to up to $20,000 for Level 4 and $1,000,000 for Level 5 violations with no limit for multiple violations. These civil fines and forfeitures are distributed to the Missouri public schools.

Who Can Be Prosecuted?

Consumers, providers (such a doctor or auto repair shop), insurance companies, adjusters, and others.

Types of Insurance Fraud & Examples

Insurance Fraud Enforcement Agencies

The agency to report insurance fraud you’ve experienced or witnessed depends on the type of insurance. If you feel you’ve been victimized by insurance fraud, contact the Missouri Insurance Consumer Hotline at 1-800-726-7390.

You can call your Medicare plan provider to ask them about possible fraud. If you’re uncomfortable doing so or the issue remains unresolved, you can reach the Senior Medicare Patrol (SMP) Program at 1-888-515-6565.

Medicaid or other Public Assistance fraud can be reported online or you can call the Missouri regional office closest to you:

  • Central: 877-770-8055
  • Eastern: 877-860-3052
  • Southeast: 877-603-4323
  • Western: 877-698-0760
  • Southwest: 877-839-4316

If you suspect a licensed professional, such as your doctor, chiropractor, or counselor, has committed insurance fraud, you may also want to make a complaint with their professional licensing board. Contact information for the boards is available on the Missouri Division of Professional Registration website.

To report Worker's Compensation fraud in Missouri call 1-800-592-6003.

Because insurance fraud laws can sometimes be complicated, it’s a good idea to consult an experienced criminal defense attorney if you have questions about your specific situation.

Related Resources

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