New Jersey Man Charged with Insurance Fraud, Theft by Deception

A Middlesex County, N.J., man has been charged with insurance fraud and theft by deception for allegedly impersonating his deceased mother to obtain cheaper renters insurance under her senior-discounted policy and for falsifying claims for jewelry and other items stolen during Superstorm Sandy.

Nicholas M. Schneiderman, 43, of Carteret, N.J., was also charged with impersonation and attempted theft by deception in an indictment handed up by a state grand jury in Trenton, N.J.

Schneiderman is accused of pretending to be his deceased mother in a June 2012 phone call to Hartford Insurance Company (Hartford) during which he transferred her AARP-discounted renters insurance from her apartment to his own. Schneiderman allegedly wanted to keep her policy open because of its favorable rates and high limits. During the call, he allegedly added his name to the policy as his mother’s “husband.”

Christopher S. Porrino

“Senior-citizen insurance discounts are meant to provide financial relief to the elderly, not illegally enrich fraudsters who want to avoid paying their fair share for coverage” said New Jersey Attorney General Christopher S. Porrino in a press release issued by the New Jersey Attorney General’s office. “This defendant is now facing serious charges for his alleged attempt to illegally line his own pockets at the expense of an insurance program intended to help senior citizens.”

Porrino added it is alleged that after fraudulently obtaining insurance coverage, Schneiderman compounded his crime by filing multiple claims for jewelry and other items he said were stolen from his car when he left his home during Superstorm Sandy in October 2012.

He allegedly collected more than $6,000 from Hartford for the stolen items, which included a laptop computer, an 18 karat gold chain and diamond earrings. He then allegedly filed another claim for the same items with American Banker’s Insurance Company of Florida, which was denied.

“It is unconscionable that a time when insurance companies were busy processing claims to help Sandy victims recover from devastating losses, this defendant was allegedly attempting to steal insurance funds by filing more than one claim for the same loss,” said Acting Insurance Fraud Prosecutor Christopher Iu in the press release. “We will not allow the system to be exploited in this way, especially not during a time of natural disaster.”

Nicholas Schneiderman

Schneiderman is charged with two counts of insurance fraud (2nd and 3rd degree), theft by deception (3rd degree), attempted theft by deception (3rd degree) and impersonation (4th degree).

The indictment is merely an accusation and the defendant is presumed innocent until proven guilty. Second-degree crimes carry a sentence of five to 10 years in state prison and a criminal fine of up to $150,000. Third-degree crimes carry a sentence of three to five years in state prison and a criminal fine of up to $15,000, while fourth-degree crimes carry a sentence of up to 18 months in prison and a fine of $10,000.

Deputy Attorney General Patrick Gessner presented the case to the grand jury. Detective Brian Bunn coordinated the investigation.

Source: New Jersey Attorney General’s Office

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Posted in Insurance News

New York Woman, Three Others Charged with Killing Her Mother

Authorities say a 22-year-old New York woman and three other people have been charged in the killing of the woman’s mother for insurance money.

The Wayne County Sheriff’s Office says the suspects include 52-year-old Julie Martin’s daughter, from Sodus, a 21-year-old Rochester man and two men, ages 18 and 19, from Henrietta.

All have been charged with first-degree murder and second-degree conspiracies. They’re being held in the county jail without bail. The district attorney’s office didn’t have information on the suspects’ lawyers.

Deputies say Martin was found dead inside her home in the town of Ontario, N.Y., on Feb. 1. Police say her daughter killed her for the insurance money.

Officials haven’t disclosed Martin’s cause of death.

The investigation is continuing.

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Posted in Insurance News

Powered by Homegrown Insurtech, HCI to Expand Flood Insurance Sales to 9 States

As Congress tries to figure out how to change the federal flood insurance program to encourage more private insurer involvement, one insurer isn’t waiting to wade deeper into the private flood insurance business. Florida-based HCI Group is looking to take its Florida flood insurance experience and its proprietary flood insurance technology to nine additional states.

HCI Group said it has begun the regulatory process to expand its private flood insurance operation into Arkansas, California, Maryland, North Carolina, New Jersey, Ohio, Pennsylvania, South Carolina and Texas.

Currently, the company offers flood insurance solely in Florida, where it has about 4,000 policies. It writes flood both as an endorsement to its standard homeowners policy in its established homeowners subsidiary, Homeowners Choice Property Casualty Insurance Co., and as standalone coverage through its relatively new TypTap subsidiary, a proprietary insurtech platform it created.

“A core part of our long-term strategic plan has been—and continues to be—expanding and diversifying our operations geographically. We believe expansion into additional markets will leverage our proven business model, as well as our internally developed technology,” said Paresh Patel, HCI Group’s chairman and chief executive officer.

Kevin Mitchell, HCI’s vice president for investor relations, said HCI is just beginning to talk with regulators in the other states to see what approach will work best in each state.

Unlike some other private offerings, HCI is targeting middle-market homes, not preferred or high-end properties. The middle-income residents on the water are the ones “who really need the help,” said Mitchell.

He told Insurance Journal that HCI will be expanding regardless of what Congress does to change the National Flood Insurance Program (NFIP). If Congress alters the rules of the program to encourage more private insurers to sell, that’s fine with HCI.

“Competition is healthy. We need the competition. We can’t write every risk,” Mitchell said.

Technology Key

While the insurer has been writing flood policies in Florida since 2013, HCI really ramped up its effort in April 2016. That was when HCI launched a separate flood-coverage only company called TypTap to sell standalone flood policies in Florida using a proprietary online platform for quoting and binding flood policies.

HCI is betting on its technology to help it capture market share. “The technology is the big thing,” said Mitchell. “It really hit a chord with agents.”

HCI Headquarters

The TypTap technology makes it easy for agents to sell and property owners to buy flood coverage.  For potential customers, the process starts with them typing in their address. They only need to answer three questions and then pick an agent from a dropdown menu to finish the policy purchasing process.

The technology is important but TypTap also competes with NFIP on coverage and pricing. TypTap offers replacement cost on contents, no 30-day waiting period, and no elevation certificate. The coverage also offers a loss of use component, which isn’t available through NFIP policies, and up to $500,000 on the building limit and up to $250,000 on replacement and contents with underwriting approval.

According to Mitchell, TypTap can price its policies competitively because of its experience, its pricing models and perhaps most important because it does not have the burden of past losses from Katrina, Sandy and other storms which NFIP must surcharge policyholders to cover. NFIP is about $24 billion in debt.

“You have to be competitive,” Mitchell said, noting that HCI is “coming in with a fresh look at the peril of flood” and isn’t paying for Katrina or Sandy. “You’re not trying to surcharge the customer to make up for underwriting mistakes.”

Mitchell said it’s “unfair” for new policyholders to have to pay for NFIP’s debt. “That’s not their fault,” he said.

But again, according to Mitchell, the technology is key. “You have to have the tech right to make it really work,” he said. “If we had a great flood product but everyone had to send in an ACORD form, it just wouldn’t work.”

He said that his company has not had any problem satisfying lending requirements with its policies because it is an admitted carrier. He said policyholders and agents also appreciate the “long-term commitment” HCI has made to the flood market.

Florida accounts for 37 percent of the NFIP’s policies, and leaders in the state have complained for years that its homeowners pay into NFIP more than they get in return and pay disproportionately higher rates than the rest of the country.

HCI Group owns subsidiaries engaged in homeowners’ insurance, reinsurance, real estate and information technology services. The company’s largest subsidiary, Homeowners Choice Property Casualty Insurance Co., is a leading provider of property/casualty insurance in Florida.


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Massachusetts Worker Injured on the Job Wins $750K Jury Award

A Massachusetts jury has recently awarded $750,000 to a man who suffered severe leg injuries while working for a landscaping business that did not carry workers’ compensation insurance.

A lawyer for 52-year-old Jose Hernandez tells The Berkshire Eagle that her client was working for Lenox, Mass.-based Rick’s Complete Lawn and Landscaping Service in February 2015 when he fell from the roof of a building while clearing show.

Hernandez landed on his feet and fractured his heel bone into multiple pieces and now suffers from osteoarthritis in his right ankle.

His lawyer says the injury limits his mobility and he can no longer perform physically demanding work.

The business owner claimed Hernandez was not an employee at the time of the injury. His attorney did not return a call for comment.

Information from: The Berkshire (Mass.) Eagle

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Posted in Insurance News

London Underwriters, Trigon to Offer Alabama Homeowners Program

London Underwriters LLC, a national MGA and surplus lines broker, has partnered with Birmingham based wholesaler Trigon Inc., to provide a new and exclusive low-value homeowners program for the state of Alabama.

The product will target homeowners (HO3, HO6 and HO4) as well as dwelling fire (DP1 DP3) forms with minimum dwelling coverage as low as $25,000 for Coverage A. Coverage will be available on A.M. Best A Class XV ES paper with an online rate and policy issuance platform.

Trigon’s President, Scott Brooks, said the partnership with London Underwriters will allow Trigon to broaden its personal and commercial lines product offerings in Alabama and provide an option to a market segment very much in need of additional alternatives.

The product will initially be available to select existing Trigon appointed agents, but will expand to consider additional retail distribution partners in the coming months, according to London Underwriter’s VP of Marketing and Business Development, Gregory Gold.

Aventura, Fla.-based London Underwriters and sister company Miami Specialty Risk LLC (Lloyd’s Coverholder) specialize in the creation and distributing of customized insurance products for personal and commercial lines for regional wholesalers and retailers.

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