Fraud Stats


  • Insurance fraud steals at least $308.6B every year from American consumers. (Coalition Against Insurance Fraud is working to update this figure in 2022).
  • Fraud occurs in about 10% of property-casualty insurance losses.
  • Medicare fraud is estimated to cost $60 billion every year. (AARP 2018)
  • Want the big picture? These infographics illustrate the impact of insurance frauds.

By Category

Consumer Attitudes

78% say they are concerned about insurance fraud.

State Laws

48 states make insurance fraud a specific crime.


In 2020, 8,898 cars were intentionally set on fire in the U.S.

Workers Compensation

1.3 million-2.1 million workers were misclassified or doing cash-only work each month in 2020.

Healthcare Fraud

$3.1B in false and fraudulent claims in 2020.


21% of insurance plan to invest in AI in the next two years.

Most consumers are concerned about insurance fraud. Americans also show increasing tolerance for specific forms of unethical insurance behavior. Six of 10 Americans believe crime is higher than the year before, say 18 of 22 Gallup surveys between 1993 and 2018. Despite the generally downward trend in national violent and property crime rates during most of the same period. (Gallup surveys, 2019,)

  • Consumers in their 20s and 30s are 25% more likely to report losing money to fraud than people 40 and over.
  • Millennials are 77% more likely than other age groups to say they lost money to a scam that started with an email.
  • Millennials are less likely to report losing money to scams starting with a phone call.

(Federal Trade Commission, October 2019)

Older Americans exploited by fraud in recent years suffered an average loss of $34,200.

Outside analysts looking at elder fraud have separately estimated losses of $2.9 billion-$36.5 billion a year. (Consumer Finance Protection Bureau, February 2019)

  • 48 states make insurance fraud a specific crime. 30 states make insurer fraud a specific insurance crime. Oregon is the only state without an insurance fraud law of any kind.
  • 42 states and the District of Columbia have an insurance fraud bureau. Most deal with all lines of insurance.
  • 43 states and the District of Columbia require insurers to report suspected fraud to the state fraud bureau or other agency.
  • 22 states have enacted laws making counterfeit airbags a specific crime.

(Coalition Against Insurance Fraud, March 2020)

  • Corporate and white-collar prosecutions are at an all-time low. This raises questions about how hard federal prosecutors pursue complex, organized insurance schemes.
  • Only 359 defendants overall were prosecuted in January 2020. Almost all were individuals rather than businesses.
  • Prosecutions in January 2020 were down 25% from just 5 years ago.
  • If prosecutions continue at the same pace for the rest of FY 2020, they’ll fall to 5,175 — almost half of their prior level.

(TracReports, March 2020)

Fraud plots are getting more complex, often involving multiple industries rather than solely insurance. An insurance investigation, for instance, might reveal evidence of financial fraud.

  • 84 percent of insurance organizations say fraud cases they investigate involve more than one industry.
  • 76 percent of cross-industry fraud cases have a moderate to high impact on insurance organizations.
  • More than half say these cases (61 percent) have severe impacts on responding insurance organizations.

In 2019 HHS recovered $5.9 billion from fraud investigations.

  • They expect to recover more than $819 million more from audits and about $5.04 billion from investigative recoveries. They include criminal actions, civil and administrative settlements, civil judgments, and administrative actions by OIG.
  • Filed 809 criminal actions against individuals or organizations accused of engaging in crimes against HHS programs.
  • Filed nearly 700 civil actions — including false claims and unjust-enrichment lawsuits involving civil monetary penalty settlements and administrative recoveries related to medical providers.
  • Excluded 2,640 individuals and entities from participating in Medicare, Medicaid and other federal healthcare programs.

Full report: (U.S. Department of Health and Human Services, December 2019) … News summary

  • Improper Medicare payments in 2018: home health ($3.2 billion, 17.6%) … durable medical equipment ($2.6 billion, 35.5%) … hospice ($2.1 billion, 1.7%) … laboratory ($1 billion, 28.2%) … all services ($31.6 billion, 8.1%).

(Government Accountability Office, March 2019)

The federal False Claims Act lets whistleblowers earn a portion of federal civil recoveries stemming from exposing fraud against federal healthcare programs. The FCA also can lead to criminal charges. Whistleblowers are often employees at offending healthcare organizations, with unique access to evidence.

  • The Justice Department obtained more than $2.6 billion in whistleblower health settlements in 2019. That’s out of at least $3 billion in whistleblower settlements overall.
  • This is the 10th straight year DOJ’s civil healthcare-fraud settlements and judgments exceed $2 billion.
  • DOJ also is instrumental in recovering additional millions of dollars for state Medicaid programs.

(U.S. Department of Justice, January 2020)

Contractor fraud

Most contractors are ethical and honest. Yet unlicensed and dishonest operators try to exploit often-traumatized homeowners after storms.

Contractors may demand large cash down payments, then disappear without doing work. Shoddy workmanship with substandard materials are other problems. Contractor schemes can cost homeowners thousands of dollars in uninsured bills.

Auto fraud

Fraudsters convince drivers they need a windshield repair or replacement when they don’t. Some glass firms bill for phantom windshield replacements, or replace undamaged windshields. Dishonest glass firms also convince consumers to sign an assignment of benefits (AOB) form. This gives the glass firm the legal right to file claims, make repairs and collect insurance payments. Firms are exploiting AOBs to inflate repair claims.

  • 68% of consumers on average aren’t aware of various auto insurance fraud, from faulty windshield replacements to bandit tow truck
  • Nearly 1 in 3 people (32%) believe they’ve been a victim of insurance fraud 
  • Auto insurance fraud is underreported, as 29% of those who say they were victims never reported their suspicions. 
  • Auto insurance fraud is underreported, as 29% of those who say they were victims never reported their suspicions. Women are less likely to report suspected fraud than men (35% versus 24%).
  • 72% of alleged fraud victims say their auto insurance premiums increased as a result. Premium increases are most likely to affect millennials, 78% of whom saw higher costs after being victims of fraud.
  • Consumers need more education about the various types of auto insurance fraud to protect themselves and their wallets. For example, 78% haven’t heard about faulty windshield replacement scams, 77% haven’t heard about bandit tow trucks and 77% aren’t aware of faulty air bag replacement scams.
  • More than one-fifth of drivers lied to their insurer. 22% admit to lying to their auto insurer, most commonly by claiming damage to their vehicle but then pocketing the money intended for repairs, or by lying about their address or number of drivers to get a cheaper premium.

ValuePenguin, Lending Tree (2021)

  • Nevada is the worst state for auto-related fraud, with an average of 346 reported auto-related fraud cases per 1 million residents.
  • The 10 top states for auto-related fraud average 315 cases per one million residents
  • Many cases of auto-related fraud involve dishonest business practices scamming customers
  • The two leading businesses behind auto-related scams are auto maintenance shops and dealerships

ClearSurance (2021)

  • Michigan ranks 1st  for the most expensive states for car insurance. (2020)

  • 10% of the nation’s auto glass claims were in Arizona between 2015 and 2019.
  • More auto-glass claims are filed in Arizona than California or Texas, with populations 5.5 and 4 times larger.
  • Auto glass claims have increased 26% over the last 5 years in Arizona. This suggests a possible spike in fraud.

(National Insurance Crime Bureau, February 2020)

Staged-crash rings injure or kill innocent victims and fleece auto insurers out of billions of dollars a year. Usually these are bogus soft-tissue injuries such as sore backs or whiplash involving billing for unneeded treatment of phantom injuries.

Other frauds include false reporting of actual vehicle drivers, faking information on annual mileage driven, lying to get insurance coverage and claim vehicles are garaged in locations with cheaper insurance rates.

10 Worst States for Auto-Related Fraud (Clearsurance, August 2021)


  • In 2020, a total of 8,898 motor vehicles were set on fire in the United States. 
  • In total in that year, there were 39,851 arson offenses recorded in the United States, of which 15,079 were structure fires. Statista (2020) 
  • The increase in total fires was statistically significant.

National Fire Protection Association (NFPA) (2021) 

  • Arson increased nationally by 19.2 percent when compared with the first six months of 2019.
  • All four regions experienced more arson, with the West seeing the largest increase of 28 percent.
  • Arson grew the most in cities with populations over 1 million, rising by 52.1 percent.
  • However, nonmetropolitan counties saw arson increase by 13.7 percent, while metropolitan counties experienced a slightly smaller increase of 11.6 percent.

FBI (2020) – first half of 2020 

  • The National Health Care Anti-Fraud Association (NHCAA) estimates that the financial losses due to health care fraud are in the tens of billions of dollars each year. 
  • A conservative estimate is 3% of total health care expenditures, while some government and law enforcement agencies place the loss as high as 10% of our annual health outlay, which could mean more than $300B.

(NHCAA, 2021)

  • HHS’ watchdog agency, the Office of Inspector General, recovered $3.1B in false and fraudulent claims in 2020, according to a July report.
  • OIG won or negotiated more than $1.8B in judgments and settlements in 2020, which, combined with efforts from previous years, led to 2020’s $3.1B recovery. Of the $3.1B, $2.1B was transferred to the Medicare Trust Fund, and $128.2M in Medicaid funds was transferred to the Treasury.
  • A total of 440 people were convicted of healthcare fraud and related crimes in 2020, the OIG said. The Department of Justice opened 1,148 healthcare fraud investigations in 2020, according to the report.

HHS (2020)


  • The Department of Justice obtained more than $2.2B in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2020, Acting Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Civil Division announced today.  Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $64B.
  • Of the more than $2.2B in settlements and judgments recovered by the Department of Justice this past fiscal year, over $1.8B relates to matters that involved the healthcare industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organizations, laboratories, and physicians.  The amounts included in the $1.8B reflect only federal losses, and, in many of these cases, the department was instrumental in recovering additional tens of millions of dollars for state Medicaid programs.

(DOJ, 2020)

  • The FY 2020 Medicare FFS estimated improper payment rate is 6.27 percent, representing $25.74B in improper payments. 
  • This compares to the FY 2019 estimated improper payment rate of 7.25 percent, representing $28.91B in improper payments. 
  • The decrease was driven by reductions in the improper payment rates for home health and skilled nursing facility claims.
  • Home Health – $5.90B decrease in estimated improper payments (2016 to 2020) due to corrective actions such as policy clarification and Targeted Probe and Educate (TPE) for home health agencies.
  • Skilled Nursing Facility – $1.00B decrease in estimated improper payments (2019 to 2020) due to a policy change related to the supporting information for physician certification and recertification for skilled nursing facility services and TPE for skilled nursing facility services.
  • The FY 2020 national Medicaid improper payment rate estimate is 21.36 percent, representing $86.49B in improper payments.
  • The FY 2020 national CHIP improper payment rate estimate is 27.00 percent, representing $4.78B in improper payments.

CMS (2020) 

  • Analyzing data from 2015 to 2020, we found a total of 3,013 such scams reported to the BBB from across the U.S.
  • The worst state for health care, Medicare and Medicaid scams is Ohio, which is home to the 3 cities with the highest number of these types of scams: Vienna, Cleveland and Columbus.
  • The worst city in 2020 for coronavirus scams – by a considerable margin – was Memphis, Tennessee, with 56 reported COVID-19 scams. That’s nearly 3 times as many scams as were reported in New York City, despite having just 1/13th of the population.
  • In all, there were 9 cities that were in the top 20 worst cities for healthcare, Medicare and Medicaid scams and also for COVID-19 scams:

    • Memphis
    • New York
    • San Antonio
    • Los Angeles
    • Cleveland
    • Saint Louis
    • Columbus
    • Miami
    • Louisville

Medicare Advantage (2020), Better Business Bureau Scam Tracker

Treatment by excluded medical providers

  • Patients treated by healthcare professionals later excluded from the Medicare program for committing fraud and abuse are between 14%-17% more likely to die than patients treated by non-excluded physicians, nurses, and other professionals.
  • Patients treated by providers banned from Medicare for fraud and abuse are 11%-30% more likely to experience an emergency hospitalization.
  • Medical providers banned for fraud and abuse treat patients more likely to be low-income, non-white, and disabled.
  • Nearly one-quarter (23%) of patients seen by excluded providers are non-white while approximately 16.5% of patients treated by approved providers were non-white.

(Johns Hopkins Bloomberg School of Public Health, October 2019)

Surprise medical bills

  • Surprise medical bills impose large and often-unfair costs on patients for out-of-network expenses they thought their health plan covered. Surprise bills can border on fraudulently inflated. Out-of-network billing can also increase healthcare costs for patients who don’t receive balance bills. Many insurance plans require higher cost-sharing (deductibles, co-insurance, co-pays) for out-of-network care.
  • More than 10% of commercial healthcare spending is attributable to services for which surprise billing is common: services by radiologists, anesthesiologists, pathologists, emergency physicians, emergency ground ambulances and emergency outpatient facilities.
  • Eliminating provider leverage stemming from the ability to surprise-bill could reduce commercial insurance premiums by as much as 5.1%, or $212 per member per year. This could reduce aggregate premiums by approximately $38 billion for the nation’s commercially insured population.

(American Journal of Managed Care, September 2020)

  • 1 in 5 Americans who undergo elective surgery — or surgery they schedule in advance — incur unexpected out-of-network medical bills.
  • Patients who incurred surprise medical bills owe $2,011 more, on average. That’s in addition to the nearly $1,800 cost that average privately insured patients would owe to their insurer for elective surgery.

(Journal of the American Medical Association, February 2020)

Some businesses illegally try to avoid paying state-required workers compensation premiums by misclassifying employees as independent contractors. Typically such workers are paid off the books to hide the evidence.

Staff labor and payroll size are two key factors that workers-compensation insurers use to gauge premiums.

Misclassifying employees in high-risk jobs as holding lower-risk jobs is another ruse. A dishonest roofing firm tells high-risk roofers are lower-risk sales staff or clerks. Misclassifying is especially widespread in dangerous professions such as construction, where risky work means high workers-comp premiums.

Misclassifying illegally avoids taxes, wages and other expenses. Shady employers often prey on minority and immigrant communities especially. This crime gives employers an unfair advantage over competitors.

  • 1.3 million-2.1 million workers were misclassified or doing cash-only work each month. Hiring seasonal workers increases these rates during peak employment.
  • Payroll scams meant employers paid only $38.2-$43.7B — saving $11.7B and $6.2B, respectively. Specific states and regions may differ.

(United Brotherhood of Carpenters, March 2020)

Medical ID theft

Thieves frequently steal consumers’ sensitive medical information to lodge fraudulent claims against the victims’ health policies.

Medical ID theft ruins a victim’s credit, and embeds dangerously wrong information in the victim’s medical records. Victims face large financial losses and enormous stress. It can take thousands of dollars to restore credit and clear up medical records.

  • 10% $1.07M 11 Increase in average total cost of a breach, 2020-2021 
  • The average total cost of a data breach increased by nearly 10% year over year, the largest single year cost increase in the last seven years.

    • Data breach costs rose from $3.86M to $4.24M, the highest average total cost in the history of this report.
  • Remote working and digital transformation due to the COVID-19 pandemic increased the average total cost of a data breach.
  • Healthcare organizations experienced the highest average cost of a data breach, for the eleventh year in a row.

IBM (2021)

  • The number of publicly-reported data compromises through September 30, 2021 has exceeded

    • the total number of events in full-year (FY) 2020 by 17 percent, even though the number of compromises dropped by nine (9) percent compared to the second quarter (Q2) of 2021. 
    • The trendline continues to point to a record-breaking year for data compromises.
  • The number of data compromise victims dramatically increased in the third quarter (Q3)~160M individuals primarily due to a series of data exposures in the Quarter.
  • The total number of cyberattack-related data compromises year-to-date (YTD) is up 27 percent compared to FY 2020, with Phishing and Ransomware far and away the primary attack vectors.
  • There have been no publicly reported data compromises to date in 2021 attributed to payment card skimming devices.
  • There is a disturbing trend developing where organizations and state agencies do not include specifics about data compromises or report them on a timely basis. 
  • One state has not posted a data breach notice since September 2020. 

Identity Theft Resource (2021) 

AITE (2021) 

  • As the first vials of COVID-19 vaccines were disseminated in December, Imperva Research Labs monitored an astounding 51% increase in web application attacks on healthcare targets.
  • Imperva data shows the healthcare industry experienced 187 million attacks per month globally, on average, or roughly 498 attacks per organization each month.
  • Throughout 2020, cybercriminals used an array of vectors to attack vulnerable healthcare organizations with the top targets being facilities operating in the United States, Brazil, United Kingdom and Canada.
  • In December, Imperva researchers saw four specific attack types increase significantly in volume of recorded attacks:

    • Cross-site scripting (XSS) attacks increased 43% in December, and represents the largest number of overall attacks.
    • SQL injections (SQLi) increased 44% and represents the second-largest volume of attacks.
    • Protocol manipulation attacks increased at the greatest rate (76%) and represents the third-largest volume of overall attacks.
    • Remote Code Execution/Remote File Inclusion (RCE/RFI) attacks increased by 68% in December, but registered a smaller overall attack volume.

Imperva Research Labs (2021) 

Forbes (2021) 

  • 45% of breaches featured Hacking
  • Organized criminal groups were behind 55% of breaches
  • 81% of breaches were discovered in days or less
  • 86% of breaches were financially motivated

VERIZON (2020)

  • Cyber crime is increasing like never before.
  • Business email compromise (BEC) incidents led the way with the frequency of reported incidents up 51% over the first half of last year.

Cyber Insurance Claims Reports – Coalition, 2020 (NOT US) 


Healthcare organizations are among the largest targets of cyber attacks. Stealing sensitive patient data often involves medical identity theft.

Sadly the healthcare sector is ill-prepared to deal with growing incidents of attacks. Healthcare lags behind financial services in devoting time and resources to hardening infrastructure protections.

Healthcare breaches remain a major problem impacting millions of Americans annually.

  • Nearly 32 million patient medical records were breached in the first half of 2019. More than double the records breached over the entire 2018 calendar year. 2018 saw breaches of more than 15 million patient records.
  • Incidents also rose in the first half of 2019, with 285 breaches reported between January and June.
  • At least one health data breach occurs each day since 2016. Hacking was the clear majority in the first half of 2019 (59%). Insider error or wrongdoing contributed to 21% of breaches, theft to 9%, and the remaining causes are unknown.

(Protenus, July 2019)

  • 2018 saw 18 data breaches exposing 100,000 or more healthcare records.
  • Eight of those breaches saw more than 500,000 healthcare records exposed. Three of those breaches exposed more than 1 million healthcare records.

(HIPAA Journal, December 2018)

The ongoing transition to electronic health records increases data breaches involving patient records.

  • One study found 2,149 breaches involving 176.4 million patient records. Individual breaches ranged from 500 to nearly 79 million patient records between 2010 and 2017.
  • Total breaches increased every year, except 2015, starting at 199 in 2010 and rising to 344 in 2017.
  • 70% of breaches involve data stored by healthcare providers. Breaches involving data kept by health plans accounts for 63 percent of all stolen records.
  • The three largest breaches together account for more than half of all stolen records.

(Journal of the American Medical Association, September 2018)


Robocalls to consumers and cyberattacks on healthcare facilities increase the risk of stolen consumer medical identities.

  • Half of U.S. adults (49%) are extremely or very concerned about the security of their healthcare data.
  • U.S. adults are most concerned about diagnosed medical conditions and diseases being mishandled or shared without their permission.
  • 36% of adults use an online portal to access their personal health information. Adults older than 34 are more likely to use a portal than 18 to 34-year-olds (39% vs 28%).
  • For adults who don’t use an online health portal, the top reasons are a preference for discussing their health in person (47%) and concern about the security of accessing their health information online (39%).

(SCOUT-Harris Poll, July 2018)

  • 26 billion scam calls were logged in 2019 (44% of all robocalls) and another 8 billion telemarketing calls (14% of all robocalls).
  • More than 2.8 billion scam and telemarketing calls are made on average each month.

(YouMail, January 2020)


Phishing emails spoofing the sender’s identity form a major cyber-security threat. And they are increasing. Phishing messages can entice recipients to open malicious links allowing the sender to access personal information. Attacks can steal and manipulate data for potential identity theft … impose ransom demands and other scams.

  • The Internet Crime Complaint Center in 2019 recorded their highest volume and the largest dollar losses since being established in 2000.
  • Nearly 1 of 7 hospital employees clicked simulated phishing emails in a 95 campaigns involving nearly 2 million messages
  • Repeated phishing campaigns are associated with decreased odds of clicking a subsequent phishing email.

(JAMA Open Network, March 2019)

Insurance fraud is rising, and mounting pressure from schemes is igniting a surge anti-fraud tech deployment:

  • Insurance fraud has risen in the last three years, about two-thirds of insurers say. Insurers are retooling with a mix of advanced analytics.
  • Predictive analytics top the list. 64% of insurers say they’ll earmark funds for predictive tools. A 45% spike from 2016.
  • Investment in link and social media analysis also is growing rapidly, say 43% of insurers vs. only 16% in 2016.
  • One in five insurers (21%) plan to invest in AI in the next 12-24 months.

(Coalition Against Insurance Fraud, assisted by SAS, March 2019)

Artificial intelligence is an increasingly useful tool in rooting out fraud, waste and abuse in healthcare. AI is especially helpful because many medical scams are large-dollar, complex and run by by well-organized crime rings.

  • U.S. health firms use smart agent-based AI to better target fraud. The three most-important expected benefits are fraud-related: stopping fraud before it happens … reducing payments fraud … and reducing fraud management personnel.
  • Just 4.3% of healthcare firms report using AI. Larger healthcare firms (22.2%) are more likely to use AI. None below $500 million in annual revenues do.
  • More than a third (34.1%) of healthcare firms are “very” or “extremely” interested in using smart agent-based AI.

( and Brighterion, April 2020)


  • Fraud linked to Covid has cost Americans $588M (total);, according to the Federal Trade Commission.
  • Seniors reported the largest losses related to coronavirus scams. The median loss for those in their 80s was $900.
  • Criminals have stolen money via a number of scams: those related to stimulus checks, unemployment benefits, COVID vaccines, fake virus cures and charities, for example.

Federal Trade Commission (2021)

  • As of August 2020, 77% of respondents said they had observed an increase in the overall level of fraud, with one-third noting that this increase has been significant. 
  • The observed level of fraud has grown since our May 2020 study, in which 68% of respondents had seen an increase in fraud, with one-quarter observing a significant increase. 
  • Our findings indicate this uptick is likely to continue; 92% of respondents expect to see a further increase in the overall level of fraud during the next year, and nearly half expect that increase to be significant.
  • We asked survey respondents about the difficulty level of preventing, detecting, and investigating fraud in the wake of COVID-19.
  • Unsurprisingly, respondents overwhelmingly indicated that all three of these activities are more difficult now than they were previously.
  • More than three-quarters indicated that preventing fraud is more challenging in the current environment, with 26% noting that
  • It is significantly so. Similarly, 74% of respondents have found investigating fraud more difficult (31% significantly more challenging),
  • and 68% have found fraud detection more difficult (21% significantly more challenging).

Association of Certified Examiners (2020) 

  • Over a quarter of our sample reported purchasing either a COVID-19-related product or a service, yet 42.5% reported feeling targeted for fraud. Wiley online Library (2021)


Price optimization – consumers beware!

Some insurers wrongfully use price optimization to increase rates. This practice analyzes consumer buying practices to increase costs for those customers deemed more “price elastic.”At least 20 states have banned or regulated this practice. A white paper by the National Association of Insurance Commissioners addressed the issue in 2015.