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According to a new report from the National Insurance Crime Bureau (NICB) insurance investigators found a record number of dubious claim referrals in 2012. The NCIB which receives insurance claims from insurers for further investigation said that the number of referrals received hit an all time high last year.

Insurance companies refer questionable claims, referred to as QCs to the NCIB for further investigation, these claims are referred based on one or more indicators of possible fraud.

The bureau saw a jump of 26.7 percent in all QCs between 2010-12. The NICB says that while the increase was big this number still only makes up a fraction of the number of total processed insurance claims every year. While a referral to the NICB does not automatically denote fraud, it simply means that the insurer found it to be suspect.

Car Theft is Biggest Cause of Fraud

There was an increase of 15 percent from 2011-12 in the 16 vehicle-related categories for referrals of a QC.

During the time period for the study, hail damage saw the biggest rate increase as the reason for a referral. In 2012, the number of hail damage referrals hit 2,112, up from 1,505 in 2011. This was a 35 percent increase.

Dubious claims concerning cars that were hit while parked went up 30 percent during this time period, which was the second biggest increase according to the report.

When it comes to sheer number though “questionable vehicle theft,” is the big leader. A total of 12,193 cars, boats and heavy equipment thefts were referred to the NICB as QCs. These types of claims jumped up six percent from 2011-12.

California is Number One State for Questionable Claims

California leads the country in questionable claims during 2012 by a huge amount. The Golden State referred 21,935 QCs to the NCIB more than double the amount that came out of Florida, the second highest state in the country.

Here is a listing of the top 10 states when it comes to QCs in 2012.

  • California: 21,935
  • Florida: 10,693
  • Texas: 10,368
  • New York: 9,059
  • Maryland: 4,296
  • Georgia: 4,126
  • North Carolina: 3,855
  • Illinois: 3,538
  • Pennsylvania: 3,353
  • Ohio: 3,289

California has long been the king when it comes to vehicle related claims. California is one of the top states when it comes to generating questionable car insurance claims, which are related to organized crime. Los Angeles leads the state and the country when it comes to cities with the highest number of questionable claims related to vehicles.

California also comes out on top in regards to sports utility (SUV) and crossover utility vehicles (CUV) thefts. It also has a much lower than average recovery rate for these stolen vehicles.

When all types of car thefts are examined, 7 of the top ten cities for stolen car rates are in California. According to the NCIB report Fresno has the highest rate in the country.

All of these thefts drive up the cost of car insurance in California. Drivers may have a difficult time finding cheap coverage especially if they live in a high-risk area.

Fraudulent claims are on the rise, especially in California. All of these questionable claims can raise insurance rates dramatically in the highest theft prone areas.