NRS § 686A.2815 – Nevada “Insurance Fraud” Laws

Under NRS § 686A.2815, Nevada law defines insurance fraud as knowingly and willfully providing false information to an insurance company or a government agency in order to obtain benefits for which you are not legally eligible.

A conviction is generally treated as a category D felony punishable by 1 to 4 years in prison, a fine of up to $5000.00, and victim restitution. The Nevada Attorney General’s Office (AG) is the law enforcement agency that prosecutes insurance fraud cases.

In this article, our Las Vegas Nevada criminal defense attorneys discuss:

• 1. Overview
• 2. Being Prosecuted
• 3. Common Crimes
  • Car Insurance Fraud
  • Health Insurance Fraud
  • Unemployment Insurance Fraud
  • Welfare Fraud
  • Workers’ Compensation Fraud
• 4. How do I report insurance fraud?
• Additional Resources

Also see our article on credit card fraud (NRS 205.760).

1. Overview

Nevada insurance fraud charges are generally prosecuted in three situations:

1. You make false representations about a fact material to applications for insurance coverage to get benefits or a lower premium;
2. You make false claims to obtain benefits from an insurance policy you are not entitled to; or
3. You lie in order to deny benefits and payouts to insurance claim beneficiaries who might otherwise be entitled to them.¹

Insurance fraud is an “intent crime.”² Therefore, you are not guilty of fraud if you make innocent mistakes on your applications or unknowingly give false information.

Other common types of fraud schemes in the insurance industry include:

• asset diversion,
• fee churning, and
• premium diversion (where insurance agents and adjusters keep insurance premiums for personal financial gain and do not give them to the underwriter).

Note that soliciting, conspiring, or attempting to commit insurance fraud is also a crime.

2. Being Prosecuted

Fraudulent claims are investigated and prosecuted by the Nevada Attorney General’s Insurance Fraud Unit (IFU) task force.

Insurance companies that believe they have been defrauded will generally notify the IFU through mail or the IFU’s online complaint form. The National Insurance Crime Bureau also makes referrals of suspected fraud cases to the IFU.

Note that Nevada’s Insurance Commissioner’s office handles any civil disputes insurance companies have with their policyholders.

Also note that hard fraud refers to claims that are completely false, while soft fraud refers to otherwise legitimate claims where the claimant may be exaggerating injuries.

3. What are common fraudulent claim crimes?

Car Insurance Fraud

Nevada car insurance fraud occurs when you falsely claim that your car has been stolen or damaged in an auto accident in order to get money. Auto insurance fraud is a category D felony, carrying:

• one to four (1 – 4) years in prison,
• possibly up to $5,000 in fines,
• the prosecutor’s costs of investigating and prosecuting the case, and
• restitution

Health Insurance Fraud

Healthcare fraud in Nevada typically occurs when doctors or medical staff:

• falsify patient records,
• fraudulently overbill an insurer, or
• bill for services and health care benefits they never performed.

This felony crime is also known as medical billing-, HMO-, or Medicare fraud.

As a Nevada state crime, medical fraud is a category D felony, carrying:

• one to four (1 – 4) years in prison,
• possibly up to $5,000 in fines,
• the prosecutor’s costs of investigating and prosecuting the case, and
• restitution

As a federal crime, federal health care fraud carries potential penalties of up to 10 years in Federal Prison and/or a fine of up to $250,000.³

Unemployment Insurance Fraud

You commit unemployment insurance (UI) fraud in Nevada when you lie to obtain UI benefits wrongfully. A common scenario is claiming you are unemployed while secretly working an under-the-table job.

Nevada UI fraud is a category D felony, carrying:

• one to four (1 – 4) years in prison,
• possibly up to $5,000 in fines,
• the prosecutor’s costs of investigating and prosecuting the case, and
• restitution

Welfare Fraud

Welfare fraud in Nevada encompasses dozens of possible state and federal offenses. Usually, this crime is committed when you fraudulently receive or facilitate a wrongful payment of welfare benefits.

Defrauding a welfare insurer is typically a category D felony. Penalties can include:

• denial of future benefits,
• one to four (1 – 4) years in prison,
• possibly up to $5,000 in fines,
• the prosecutor’s costs of investigating and prosecuting the case, and
• restitution

Worker’s Compensation Fraud

You commit workers’ compensation fraud in the state of Nevada when you intentionally lie in order to obtain benefits wrongfully or to deny benefits to someone else.

Defrauding a worker’s compensation insurer is a category D felony regardless of whether the applicant or the employer committed it. Penalties for defrauding a workers’ compensation insurer can include:

• denial of future benefits,
• one to four (1 – 4) years in prison
• possibly up to $5,000 in fines,
• the prosecutor’s costs of investigating and prosecuting the case, and
• restitution

4. How do I report insurance fraud in Nevada?

To report insurance fraud, call the Nevada Attorney General’s Office at either:

• 702-486-3420 (Las Vegas office)
• 775-687-2100 (Reno office)
• 775-684-1100 (Carson City office)

Alternatively, you can complete this complaint form and email it to A[email protected]. Or you can also submit this complaint form online.

If you simply have a dispute with an insurance company, contact the Insurance Commissioner’s office.

Another option for reporting insurance fraud is to call the National Insurance Crime Bureau (NICB) at 1-800-TEL-NICB (835-6422).

Additional Resources

For more information, refer to the following:

• Nevada Division of Insurance – State agency tasked with protecting the rights of insurance policy holders and ensuring insurers’ financial solvency.
• Nevada Insurance Fraud Unit (IFU) – Department of the State Attorney General’s Office dedicated to prosecuting insurance fraud.
• Nevada Insurance Fraud Unit Frequently-Asked-Questions – General information about insurance fraud provided by the Nevada Attorney General.
• NRS 686A: Trade Practices and Frauds – Nevada statutes re. insurance fraud.

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Legal References