Ontario budget takes aim at auto insurance fraud

The Ontario government announced its intention to target auto insurance fraud in its 2011 budget.
Both Insurance Bureau of Canada (IBC) and Insurance Brokers Association of Ontario (IBAO) applaud the announcement.
In the budget, Ontario Finance Minister Dwight Duncan said the government intends to augment the set of reforms implemented on Sept 1, 2010 with the following initiatives:
• working with the industry to use the newly established Health Claims for Auto Insurance (HCAI) database to detect potentially fraudulent activity;
• introducing new rules to ensure treatments are provided as invoiced;
• establishing an auto insurance anti-fraud task force to determine the scope of auto insurance fraud in Ontario and make recommendations regarding detection, investigation, enforcement and consumer education. The government said it is committed to investigating the problem of auto insurance fraud fully and will establish appropriate working groups of stakeholders to develop collaborative approaches; and
• requiring auto insurers to annually attest that their companies have established effective compliance controls to satisfy and protect the rights of policyholders and accident victims.
The government also plans to introduce an amendment to the Ontario Insurance Act to help municipal transit systems control fraudulent claims.
“Insurance fraud is a problem that affects all Ontarians who are concerned about crime, public safety and increased auto insurance premiums,” said Ralph Polumbo, IBC’s vice president of Ontario. “We appreciate the efforts of the government for taking these first steps to combat this escalating problem and hope more will be done in the future.”
IBAO CEO Randy Carroll echoed this sentiment in a separate statement.
“We commend Premier McGuinty and Minister Duncan on today’s budget,” Carroll said. “Today’s budget announcement only reminds the insurance industry of the need for us to all work together to protect Ontario consumer interests.”