Insurance fraud costs consumers in the U.S. between $80-120 billion each year, equaling about $950 per family annually. It is the second most profitable crime in the U.S. behind only illegal drug sales. Examples of insurance fraud include but are not limited to:

  • Deliberate attempts to stage an accident, injury, theft, arson or another type of loss that would be covered under an insurance policy (e.g., setting fire to your home)
  • Exaggerating a legitimate claim (e.g., doubling the value of stolen jewelry)
  • Knowingly omitting or providing false information on an insurance policy application (e.g., purchasing a policy for a previously damaged vehicle and omitting the damage in the application to file a claim at a later date)

North Dakota Fraud Referral Statistics

  2016 2017 2018 2019 2020
Insurance fraud cases 228 235 265 339 302
Declined by prosecutor 0 1 0 0 0
For information only 21 31 36 45 40
Investigative criteria not met 87 105 86 135 137
Jurisdiction 33 22 44 28 39
No evidence of a crime 37 22 33 77 42
Prosecuted 14 8 18 6 7
Prosecution not appropriate 6 17 20 4 5
Statute of limitations 4 6 6 5 4
Unable to prove beyond a reasonable doubt 26 24 21 31 18
Open 0 0 0 8 10
Amount of actual loss $545,728.96 $148,616.86 $140,473.66 $1,189,788.05 $626,792.64

A common misconception about insurance fraud is that it is a victimless crime, however, that couldn't be further from the truth. Insurance fraud doesn't just negatively affect insurance companies - it touches all North Dakotans. That is why the North Dakota Insurance Department created the Insurance Fraud Unit, a portion of the Department's Legal Division. Department detectives regularly work closely with multi-jurisdictional task forces, state and federal agencies, fire departments, local law enforcement, insurance companies and the public to identify, investigate and prosecute insurance fraud. Additionally, the Insurance Fraud Unit maintains statistics related to insurance fraud investigations, participates in the legislative process, offers public speaking and training opportunities, executes search warrants and partners with local, state and federal agencies to seize evidence or apprehend suspects during raids.

The Department has also recently developed a fraud prosecution program which involves Department attorneys working with county state's attorneys to prosecute insurance fraud and related offenses across the state. Insurance fraud is a complicated and specialized area of law. Many county state's attorneys are already burdened with heavy caseloads that may not allow them adequate resources to prosecute cases referred to them. The fraud prosecution program seeks to alleviate some of that burden and ensure appropriate resources are in place by partnering with county state's attorneys to prosecute these offenses in North Dakota.

If you suspect that a fraudulent insurance act is occurring, or has occurred, please contact the Department. Individuals can report fraud online through the National Association of Insurance Commissioners (NAIC) Online Fraud Reporting System (preferred method) or submit a Uniform Suspected Insurance Fraud Reporting form (SFN 58333).