Fall is in full swing and it’s time to start thinking about state anti-fraud legislation for 2009. Most claims personnel are relatively new to pushing for fraud laws, but it’s vital to continue to add tough new laws to the books. Fraud laws can be effective deterrents to insurance crime, and enable prosecutors to land convictions that might be far more difficult using other laws.
Insurance fraud remains at persistently high levels in many states—an $80 billion annual crime spree nationally. Aside from the damage to your policyholders and the financial drain on insurers, swindlers also undermine your own efforts to ensure that fair and clean claims pass through the insurance system with ease.
Currently, most states have gaps in their fraud laws. Working with other colleagues, such as SIUs, claims professionals have a tremendous opportunity to make a positive impact in a very tight market. But getting started for 2009 requires a sense of urgency, and time already is growing short.
Many state legislative sessions last only a few weeks or months and, when they begin, anti-fraud initiatives will be competing with a myriad of other bills. Consequently, maneuvering and numerous debates take place in a relatively short time span. Several states also are dealing with budget crises, which could deflect legislators’ attention away from bills of all stripes.
In a challenging environment such as this, your game plan should be well-oiled and ready when the doors open, which will give you an advantage to cut through the clutter and be heard. Remember, your credibility as a trained expert and voting constituent carries weight. You’re also fighting crime—a white-hat issue that can affect voters throughout your state.
Here are 13 ways you can have an impact as a player, even if you’re new to fraud legislation:
- Create a leadership council. Someone has to lead and make decisions. Gather politically astute claims people, or those who are committed and will learn on the run. Keep the leadership group fairly lean in order to make decisions efficiently. Add more people as you enlist new allies.
- Identify fraud problems or gaps in current laws. Review your state’s fraud problems and see if there are gaps in fraud laws. Is an entirely new law needed? Does an existing one need to be revised? Maybe owner giveups are spiking and a law requiring people to sign affidavits when reporting a vehicle theft would be a deterrent.
- Work in sync with your insurers. If you’re a carrier claims employee, know your insurer’s approach to legislative involvement. Your employer may give you a green light (and time) to work on your own or to go through channels such as your insurer’s local/regional lobbyists.
If you have a green light, make sure your insurer’s lobbyists know what you’re doing. Your lobbyists may have different legislative agendas and may or may not want to get involved. At a minimum, everyone should keep in touch with each other to make sure no one inadvertently creates a problem for the other.
- Draft your fraud bill. You’ll need a draft proposal, or at least detailed talking points, when asking a legislator to sponsor a bill. Organizations like The Coalition Against Insurance Fraud can assist in drafting bills, and often may provide model bills you can easily adapt. (Visit www.InsuranceFraud.org/legislation.htm to see the coalition’s model bills.)
- Research the issue. Create a fact-based case that demonstrates the need for a fraud bill. Is there data to show a spike in frequency and severity of targeted schemes in your state? Is there evidence of an impact on the state’s economy? Are there poignant examples of victims who might be willing to testify? Can your company provide data, especially the SIU? You’ll need this kind of information to sell your cause to potential sponsors, testify at committee hearings, and enlist allies.
- Sign up bill sponsors. You’ll need committed legislators to champion your cause in each chamber. Work with your allies to identify and approach potential sponsors who can get the job done. Are they committed and willing to work hard? Do they know fraud issues? Do they have clout? Do they sit on key committees that filter fraud bills and have the ear of the committee chairs?
Also, decide who should approach potential sponsors. Your insurer’s lobbyists—if they choose to get involved—might have solid ties to the right lawmakers. If one of your leadership council members has college fraternity/sorority ties to, or is a neighbor of, or belongs to the same Kiwanis chapter as a lawmaker, maybe that ally can get a call returned.
- Know the gatekeepers. Understand where the power flows. Which committees decide what bills make it to the legislative floors? Do the chairs have a history of support for fraud bills? What about the heads of each chamber? Does anyone in your lobbying effort have a personal relationship with leaders that might help move your bill along at each step?
- Know the election year’s impact. In this election season, allies might gain strength or disappear—the same with opponents. Committee chairs and chamber leaders might come, go, or stay. Power can shift for or against your efforts. Make it a point to know who’s who after the election shakeout.
- Network with other allies (fraud fighters). Politics is about power, and power tends to be about numbers. The more voters who are on your side, the better your chance of success will be. First see if fellow fraud fighters will join in or allow you to piggyback onto their efforts. Link up with local IASIU chapters, the insurance department, the attorney general’s office, state/regional insurance federations, district attorneys and your state fraud bureau. Support of law enforcement, such as the police or highway patrol, also can be very helpful. As crime-fighting white knights, their public backing can add weight to your efforts. Find out if they have state/regional associations that might support your bill.
- Enlist other allies (non-fraud). Credible non-fraud allies can add heft to your bill. Look to constituent groups who might be directly affected by the schemes your bill fights. Many have well-organized umbrella groups that might sign on. Consumer groups, local AARP chapters, chambers of commerce and ethnic associations are examples of others who might be potential allies.
- Work with national experts. A world of top-notch experts can support your lobbying. The Coalition Against Insurance Fraud, National Insurance Crime Bureau (NICB), National Association of Insurance Commissioners (NAIC) and others all can assist. For example, The Coalition Against Insurance Fraud can support your campaign in numerous practical ways by providing tools such as:
- Model fraud bills on various issues—they provide a leg up with initial drafting. You can adapt them or introduce them as is. Visit www.InsuranceFraud.org/legislation.htm.
- Advice on drafting bills.
- Advice on writing legislative testimony.
- Testimony at legislative hearings (in person or via written statement). The coalition’s national anti-fraud reputation carries weight with state legislators.
- Support on political strategy—they’ve worked on dozens of state fraud bills for 15 years and can lend that expertise to your efforts.
- News stories about local fraud cases—they maintain a large database of stories. These might supply useful cases that put a human face on the schemes your bill is combating.
- Support in gaining news coverage and other publicity.
- Build public support. Convince legislators and voters that your cause is right and has wide public backing. Working with reporters to promote your bills—and the targeted fraud problem—is a key starting point. Asking your allies to mobilize their own constituents to write letters and e-mails to their legislators can be another vital component. But note, bill sponsors sometimes prefer to work quietly behind the scenes. They know the intricate politics involved and, sometimes, less is more.
- Educate legislators. Why wait until crunch time? Educate legislators year-round about insurance fraud in general plus the specific issues in your legislation. Invite key legislators to visit insurer claim and anti-fraud facilities, and have them talk with claims and SIU staff. The more legislators learn about fraud, the better the chances of a favorable vote. Some insurance groups may also hold legislative days in the state capitol—a great chance to visit home-district lawmakers. Consider starting your own fraud legislative day or being part of another insurance group’s established legislative day.
Passing fraud laws can be challenging, but it also can be incredibly uplifting when your hard work improves the lives of people, helps insurers and makes your own work easier. As we all know, insurance fraud won’t go away overnight, but we can keep whittling away at this crime one new fraud law at a time.
Howard Goldblatt is the director of
Government Affairs for the Coalition Against Insurance Fraud. For more information and support in your anti-fraud campaign, contact
Goldblatt at 202.393.7332 or
howard@insurancefraud.org.