SB 322: Insurance Fraud Prevention Amendments

• Incorporates National Association of Insurance Commissioners (NAIC) Fraud Prevention Model Act language into North Carolina insurance law, including defining "fraudulent insurance act" as an act or omission affecting insurance business committed with intent to injure, defraud, or deceive another person.

• Expands Insurance Commissioner authority to investigate and prosecute suspected fraudulent insurance acts, including powers to conduct investigations outside the state, share records with law enforcement and regulatory agencies, arrest without warrant upon probable cause, and make criminal referrals.

• Requires insurers to maintain antifraud initiatives including fraud investigators and antifraud plans submitted to the Commissioner that describe detection, investigation, and reporting procedures along with employee training plans.

• Establishes confidentiality protections for fraudulent insurance act investigation information while allowing Commissioner to share information with other regulatory agencies and law enforcement agencies that agree to maintain confidentiality.

• Increases criminal penalties for insurance fraud offenses: false statements on claims range from Class 1 misdemeanor (under $1,000) to Class C felony ($100,000 or more), rate evasion fraud upgraded from Class 3 to Class 1 misdemeanor, and fraudulent insurance certificates range from Class 1 misdemeanor (under $5,000) to Class I felony ($5,000 or more); most criminal penalty changes effective December 1, 2019.