News: 2007 Press Release

SACRAMENTO - Today Insurance Commissioner Steve Poizner applauded the Assembly Insurance Committee for passing Assembly Bill AB 1401 (Aghazarian, R-25) on a bi-partisan vote (8-0).

A measure that would provide the California Department of Insurance (CDI) with additional investigators to fight insurance fraud, AB 1401 would also require the CDI to post investigative program performance outcomes on its Web site.

"Insurance fraud is not a victimless crime," said Commissioner Poizner. "As consumers, we pay the cost of fraud through higher insurance premiums. As commissioner, I will fight insurance fraud to the fullest extent of the law."

It is estimated that insurance fraud totals $15 billion per year in a $118 billion per year industry. This essentially imposes a "fraud tax" of nearly $500 per year on every man, woman and child in California.

Since 1973 insurers have been required by law to pay an annual fee which helps California combat insurance fraud. AB 1401 would increase this assessment to $5,100 per insurer. This assessment has gone virtually untouched over the past 34 years, with the exception of a $300 increase in 2000. AB 1401 would adjust the assessment for inflation, helping CDI fill approximately 22 vacant positions.