Insurance: they seek to modify the Penal Code to increase penalties for fraud

In what may constitute a milestone for the insurance industry in Argentina, A bill proposes to modify the Penal Code and punish those who commit acts of fraud with sentences of between four and six years.

The initiative, presented by the deputy Cristian Ritondo with the support of fourteen other legislators, aims to put an end to a common practice of which companies and indirectly the insured are victims, who see how their policies become more expensive every time the system requires additional funds to face a avalanche of cases.

The project, which is already in the Commission for treatment, was promoted in a personal capacity by the businessman Gabriel Bussola, president of Libra Insurance, who has been carrying out this fight against insurance fraud for years. Bussola found echo in the current Minister of Justice, Mariano Cúneo Libarona, and in 15 deputies.

“Anyone who, in order to provide himself or another with an illegal benefit to the detriment of an insurer… sets fire to or destroys an insured thing… or who, with an assumed name, simulated quality, false titles, influence, will suffer a prison sentence of four to six years. lie, abuse of trust or pretending assets, credit, commission, company or negotiation, simulating claims or using any other trick or deception, commits fraud to the detriment of an insurer, reinsurer or another insured”the Penal Code will now say in its article 174.

The project indicates in its recitals: ”In terms of fraud against insurance companies, we can find cases in which accidents are staged to make claims for damages and/or injuries (with false complaints to the authority), where the following are often involved: false witnesses; repair shops and/or care centers and health professionals who issue false documents and/or bill for services not provided and/or invoke unnecessary treatments… while, in many cases, the risk is insured with more than one insurer and then claim payments from different insurance companies.”

“We are being protagonists of a fundamental change in the country’s culture. The increase in penalties will change the lives of thousands of people, both those who are part of the insurance industry and those who should think twice before engaging in this type of behavior. “We have been maintaining for a long time that whoever makes them must pay for them, and with these changes we understand that, as they say, the joke is over,” Bussola said.

Until now, the law punishes anyone found guilty of the crime of fraud with suspended sentences of up to two years, a sanction that can be released from prison and is usually redeemed with probation. Generally, insurance companies carry out their own investigations into an alleged case of fraud and are satisfied with the dismissal of the person who attempts it. Now it will be 4 to 6 years of effective compliance.

For the businessman, “We must take care of those who act in good faith, the insurance system and the user, we must put an end to Creole liveliness. The decrease in cases of fraud will mean that the insurance system will enjoy better health, the companies will become more solvent and the insured will pay less for their policy.”

Bussola considered that a project of this type “should not find opposition in Parliament”, while at the same time he was enthusiastic about what he understands is the realization of a personal dream: “I never imagined that an initiative originating more from ethics than economics would serve to modify the Penal Code. “This invites us to get involved, to leave behind speeches and good intentions to try to change things once and for all,” he added.

According to figures from the insurance sector, 40% of the compensation amounts paid annually are actually unjustified, since they correspond to non-existent claims or fraudulently inflated compensations. But in Argentina, this percentage rises to 47%: in almost half of the cases, companies pay more than they should have paid or directly take charge of fraud cases.