Mike Causey: Fighting fraud can help control insurance premiums

I was asked recently what can be done to keep homeowners' insurance premiums from going up. My response: Aggressively fight insurance fraud.

The question came as I was explaining my decision to reject a recent average statewide 42.2% increase in homeowners' insurance rates.

This white-collar crime is vast and affects about any type of insurance you can imagine. It puts upward pressure on property and casualty insurance such as homeowners' and automobile insurance. Fraud affects life insurance premiums and causes health insurance costs to go up.

Some estimates suggest that 20 cents of every premium dollar go to cover the cost of insurance fraud.

A 2022 study conducted for the Coalition Against Insurance Fraud found that nationally, insurance fraud costs consumers a mind-boggling $308.6 billion a year. For a family of four, that comes out to about $3,800 a year, or slightly less than $1,000 per person.

What could you do with an extra $3,800 a year? You could take a nice vacation, start a renovation project, make a down payment on a new car, pay down a debt or deposit it in a savings account for a rainy day.

Insurance fraud takes many forms. Here are some examples:

A motorist who didn't have collision insurance could have a crash, call their insurance company to add collision coverage and then claim the wreck occurred after the collision coverage was added.Someone could rent a moving truck and stage an accident with a friend. Then they'd fake an injury to collect on the trucking company's insurance.A worker could fabricate an injury or exaggerate a legitimate injury to claim additional workers' compensation money.

If you suspect insurance fraud or other white-collar crimes, don't be shy. You may anonymously report it by calling the Department of Insurance's Criminal Investigations Division at 919-807-6840 or toll free from anywhere in North Carolina at 888-680-7684. You may also report it online at www.ncdoi.gov.