Minnesota Insurance Fraud Laws

When a person makes a false claim to an insurance company, it makes everyone’s insurance rates go up. Making a claim for an item that was supposedly lost or stolen, but wasn’t, or trying to get a ski vacation injury covered by your workers’ compensation, for example, is insurance fraud. Insurance fraud manifests itself in many ways. Minnesota prohibits most offenses related to insurance fraud.

The following table details Minnesota’s insurance fraud laws.

Code Section Minnesota Statutes Section 609.611 – Insurance Fraud
What Is Prohibited? Under Minnesota insurance fraud laws, individuals are prohibited from doing any of the following with the intent to defraud anyone for financial or other gain:
  • Presenting or preparing any information containing a false representation about a material fact on behalf of an insurance consumer, specifically for:
    • An application, renewal, or payment of an insurance policy
    • An insurance claim for payment or benefit
    • A loan or other finance transaction application
  • Presenting or preparing any information containing a false representation about a material fact to or by an insurer, specifically about:
    • Soliciting the sale of an insurance policy
    • An application for a certificate of authority
    • The financial condition of an insurer
    • The acquisition, merger, or dissolution of an insurer
  • Soliciting or accepting new or renewal insurance risk for an insolvent or bankrupt insurer
  • Removing assets or records of assets or transactions from the insurer’s office or destroying them
  • Diverting, misappropriating, or embezzling insurance consumer funds related to insurance transactions, business activities, or acquisition, mergers, or dissolutions of insurers
Penalties Minnesota penalizes insurance fraud based on either the value of the property, services, or other benefit wrongfully obtained or attempted to obtained or the economic loss suffered by any person from the crime (whichever is greater). Once that value is calculated, the penalty is based on the theft statute sentences.

  • For more than $35,000 in defrauded value, the penalty is not more than 20 years in prison and a fine up to $100,000
  • For $5,000 to $35,000 stolen, the punishment is up to 10 years imprisonment and up to a $20,000 fine
  • For $1,000 to $5,000 taken, the sentence is not more than 5 years and not more than $10,000
    • This also applies for property or services stolen from $500 to $1,000 with a prior conviction for theft, burglary, robbery, receiving stolen property, unemployment benefit fraud, forgery, forging checks, credit card fraud, or public benefit fraud in the last 5 years
  • For $500 to $1,000 in value, the penalty is no more than 1 year in jail and a $3,000 fine
  • For up to $500 in value, the punishment is up to 90 days in jail or a fine up to $1,000

Also, defendants will be ordered to pay back persons harmed by the insurance fraud, called restitution. Restitution is generally ordered in addition to fine and imprisonment, not in lieu of either.
Insurance Fraud Enforcement If you suspect someone is committing insurance fraud or workers’ compensation related fraud in Minnesota, you can call the Minnesota Department of Commerce’s Fraud Tip Line at 1-888-FRAUD MN (1-888-372-8366).

Note: State laws change regularly. It’s important to verify the laws you’re researching by conducting your own legal research or consulting with an experienced Minnesota insurance law or criminal defense attorney.

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