HB460 Summary

• Defines insurance fraud as knowingly committing acts with intent to defraud, including submitting false information, embezzlement, unauthorized insurance transactions, and improper deductible practices, with prosecution limited to six years after violation.

• Establishes three degrees of insurance fraud as felonies or misdemeanors based on loss amount: First degree (Class B felony) and second degree (Class C felony) for losses exceeding $1,000, and third degree (Class A misdemeanor) for unlicensed insurance transactions.

• Creates Insurance Fraud Unit within Department of Insurance with authority to investigate suspected fraud, issue subpoenas, execute arrest warrants, and share evidence with law enforcement agencies; assesses insurers $200 annually to fund operations.

• Requires fraud warnings on insurance documents, mandates reporting of suspected fraud to the Department of Insurance or Attorney General, and provides civil immunity for persons reporting suspected fraud unless made with actual malice.

• Establishes Insurance Fraud Unit Fund in state treasury and appropriates $320,000 each for fiscal years ending September 30, 2011 and 2012; provides civil penalties up to $5,000 per violation and license suspension or revocation for violations.