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Virginia Insurance Fraud Laws

Definition of Insurance Fraud

In Virginia, insurance fraud can occur in numerous ways. Generally an insurance fraud offense occurs when someone tries to make money from insurance transactions through deception.

Examples of insurance fraud include:

  • Worker’s Compensation : An employee claims to have suffered an injury while on the job and either didn’t suffer an injury at all, or received the injury while doing something non-work-related. Employers can also commit worker’s compensation fraud by understating the number of employees or the type of work they do.
  • Property Fraud: Someone exaggerates the amount of damage incurred to their home, vehicle 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?

Virginia state and local prosecutors handle insurance fraud cases under the state's penal code. The Feds can also prosecute insurance fraud under a number of criminal statutes including "mail fraud," "criminal racketeering," or other federal charges.

How do I File a Complaint Against an Insurance Company?

Contact the Virginia State Police for complaints against insurance carriers and discount health plan providers, including suspected insurance fraud.

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

See also Association of Certified Fraud Examiners, Fraud, Fraud and Financial Crimes, and Arson.

Code Section

Virginia Insurance Fraud Code

What is Prohibited Knowingly lying about, or concealing, an important fact in connection with a insurance claim or payment made under an insurance policy. Applies to issuing fake insurance policies and rate-fixing. Also includes conspiring to do any of the above.
Penalties

Possible criminal penalties including jail time, fines, restitution.

Possible civil penalties including fines, revocation of business license, etc.

Who Can Be Prosecuted Consumers, providers (such a doctor and auto repair shop), insurance companies, adjusters and others.
Types of Insurance Fraud
  • Automobile accidents
  • Automobile insurance
  • Health care claims
  • Insurance applications
  • Medicaid
  • Disability benefits
  • Unemployment insurance
  • Workers' compensation

Insurance Fraud Detection Reward Program

Individuals may apply for a reward for any tip that leads to an arrest and conviction.

• Mention the reward when reporting suspected insurance fraud.
• For property and casualty lines of insurance only
• Insurance professionals, law enforcement officers, perpetrator/co-perpetrator and crime victims are ineligible for a reward.

Examples of Insurance Fraud
  • False worker’s compensation claims
  • False or misleading property loss claims
  • Arson for profit
  • Staged car accidents for insurance settlements
  • Health care claims fraud
  • Falsely obtaining unemployment insurance benefits when you are working
  • Small accidents in collecting an insurance check without fixing vehicle
  • Home repair fraud
  • Stolen car scams
  • Unnecessary medical procedures

Enforcement Agency

If you feel you have been victimized by insurance fraud, contact the Virginia State Police Insurance Fraud Program, at 1-877-62FRAUD (623-7283).

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

Next Steps: Search for a Local Attorney
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