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Minnesota leads in auto insurance fraud

The Insurance Federation of Minnesota (IFM) recently called on regulators, prosecutors and legislators to redouble their commitment to crack down on no-fault auto insurance fraud in the state.

The crack-down came after new statistics showed Minnesota as the state with the nation's highest rate of increased organized crime activity in insurance fraud.

The new report by the National Insurance Crime Bureau (NICB) indicated that in the last four years, the rate of organized crime involvement in auto insurance fraud was up 230 percent in Minnesota.

According to the NICB report, a pattern of "reverse migration" is emerging, where criminals are relocating to other no-fault auto insurance states, particularly Minnesota, after fraud fighting efforts intensify elsewhere.

The schemes are costing Minnesota drivers millions of dollars in wasted auto insurance costs each year.

Insurance fraud is a felony-level criminal offense in Minnesota, but the crime is difficult to prosecute because the schemes are often complicated and feature multiple layers of complex financial deceit.