Article 8. Insurance Fraud Prevention of California Insurance Code >> Division 1. >> Part 2. >> Chapter 12. >> Article 8.

The purpose of this article is to confront aggressively the problem of insurance fraud in this state by facilitating the detection of insurance fraud, eliminating the occurrence of fraud through the development of fraud prevention programs, requiring the restitution of fraudulently obtained insurance benefits, and reducing the amount of premium dollars used to pay fraudulent claims.

The commissioner or his or her designated deputy commissioner may convene meetings with representatives of insurance companies to discuss specific information concerning suspected, anticipated, or completed acts of insurance fraud. Information shared at those meetings regarding specific suspected, anticipated, or completed acts of insurance fraud shall not make a person subject to civil liability for libel, slander, or any other relevant cause of action provided that all of the following requirements are met:
  (a) The commissioner or his or her designated deputy commissioner is present at the meeting or meetings.
  (b) The commissioner or his or her designated deputy commissioner advises meeting participants, at the beginning of any meeting convened pursuant to this section, of guidelines to ensure compliance with federal and state antitrust laws.
  (c) There is no fraud or malice on the part of the representatives of the insurance companies or the commissioner or his or her designated deputy commissioner.

(a) Any insurer that prints, reproduces, or furnishes a form to any person upon which that person gives notice to the insurer of a claim under any contract of insurance or makes a claim against the insurer for any loss, damage, liability, or other covered event shall cause to be printed or displayed, in comparative prominence compared to other contents, the following statement: "Any person who knowingly presents a false or fraudulent claim for the payment of a loss is guilty of a crime and may be subject to fines and confinement in state prison." The statement shall be preceded by the words: "For your protection California law requires the following to appear on this form" or other explanatory words of similar meaning.
  (b) Any insurer that has produced or caused to be printed forms containing the statement required by subdivision (a), as originally added by Chapter 1008 of the Statutes of 1994, may continue to use those forms until December 31, 1996. This subdivision is intended to prevent any unnecessary waste of resources that might result from insurers' efforts to comply with conflicting provisions of law.

The commissioner shall appoint supervisory and investigatory personnel within the bureau. In addition, the commissioner shall assign staff counsel who are employed by the department and are under the supervision of the department's general counsel to advise the department's fraud division, and to further the purposes of this article and Article 1 (commencing with Section 1871). The attorneys' duties may include representing the commissioner and the department in civil lawsuits pursuant to Article 1 (commencing with Section 1871). Those persons shall be qualified by training and experience to perform the duties of their position. When so requested by the commissioner, the Attorney General may assign one or more deputy attorneys general to assist the commissioner in the performance of these duties.

(a) The Chief of the Fraud Division and those investigators designated by him or her may expend funds to conduct undercover activities, employ civilian operatives, or in any other manner not prohibited by law to investigate insurance fraud or workers' compensation fraud.
  (b) The money expended pursuant to subdivision (a) shall be paid out of the funds appropriated or made available by law for the support or use of the department.

(a) Any person who believes that a violation of this article has been or is being made may notify the department immediately after discovery of the alleged violation and may send to the department, on a form and in a manner prescribed by the commissioner, the information requested and any additional information relative to the alleged violation as the department may request. The division shall review the reports and select those alleged violations as may require further investigation. It shall then cause an independent examination or evaluation of the facts surrounding the alleged violation to be made to determine the extent, if any, to which fraud, deceit, or intentional misrepresentation of any kind exists.
  (b) No person shall be subject to civil liability for libel, violation of privacy, or otherwise by virtue of the filing of reports or furnishing of other information, in good faith and without malice, provided pursuant to this section or requested by the department as a result of the authority conferred upon it by law.
  (c) The commissioner may, by regulation, require admitted insurers to keep any records and other information as he or she deems necessary for the effective enforcement of this article.

The commissioner may adopt administrative regulations as he or she deems necessary for the effective implementation of this article.

The commissioner shall report annually to the Legislature as to the activities of the department and the cost-effectiveness of the programs established pursuant to this article.

Nothing in this article shall be construed to preclude the applicability of any other provision of civil or criminal law that applies to any act committed or alleged to have been committed by any person.