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Batons and Bullets: Protocol for insurance 'battles' developing

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Some state insurance department staff may wear pocket protectors. Others, bullet proof vests. Insurance department staff investigators clearly have a perilous job at times.  

We are not talking about actuaries breaking their pencil points over the application of Actuarial Guideline 38, principles-based reserving (PBR) implementation equations or long hours in grey-green light puzzling over reserves that have fled domiciled state balance sheets for captive insurance companies in other jurisdictions. 

No, department investigators of the non-forensic type are dealing with whether to wear protective gear, carry guns and respond with baton techniques or deadly force to defend themselves during interviews with the subjects of their investigations, who may possibly be violent types perpetrating insurance fraud.’s Laura Mazzuca Toops reported just yesterday that insurance fraud is bigger than ever, and scammers are constantly coming up with new wrinkles. The National Insurance Crime Bureau (NICB) conducts numerous studies on insurance fraud and reports a 27 percent increase in the submission of questionable claims by NICB member insurance companies since 2010.

“Some states may choose to arm investigators, while others may use other safety or protective equipment such as batons, pepper spray, etc. State insurance departments may want to determine the need for safety or protective equipment such as bulletproof vests based on the situation, the witness or suspect and prior criminal history,” stated a proposed document on guidance for investigators who are up for review by the National Association of Insurance Commissioners (NAIC) executive and plenary body later this month. 

In a color-coded table depicting escalations of aggression and confrontation, an individual’s action is listed alongside the investigators potential response, beginning with blue, where verbal threats are made, to red, where deadly weapons are flourished. Responses along the color spectrum range from attempting to leave the situation to “striking muscle groups,” defense spray, baton techniques and using deadly force with whatever weapons, natural or not, are available. 

“In a confrontational situation, personnel shall identify themselves and issue verbal commands whenever feasible. If the command fails, personnel shall leave the area. When attempts to diffuse the situation fail, self-defense may become necessary; however, responses to aggression must be reflective of the amount of aggression given by the subject,” the guidance states.

The guidance also covers whether the investigators should carry weapons when conducting surveillance, when conducting interviews of targets of an investigation, or when conducting interviews of parties associated with an investigation. It also says this should be done on a case-by-case basis and that the department should consider situations in which the equipment may not be carried for safety purposes — i.e., non-work situations, out of state travel or in the courtroom.

If the department decides to provide weapons, it should develop a policy for storage of weapons and for reporting lost or stolen weapons, naturally, the guidance says. 

The NAIC is set to vote on adopting the guideline at the Winter National Meeting Dec. 18, according to its agenda for the meeting. The guidance suggests that all staff investigators pass department-approved safety training. 

In addition, the guidance says departments should consider developing an investigator safety form. This form would contain personal information concerning an investigator which can be provided to law enforcement agencies in the event of an emergency. The forms should remain on file with the department and access should be restricted to only those few individuals in a “need to know” position.

The guideline, titled Insurance Department Investigator Safety Guideline and adopted by the Market Regulation and Consumer Affairs Committee in late August, outlines the potential issues to be considered by states when developing safety policies, as well as providing tips. The NAIC and its Antifraud Task Force are developing a training program and webinar for investigators. 

One tip is to consider requiring interviews or examinations to be conducted in a protected, public venue such as a restaurant, coffee shop or public library; the insurance department office; or a law enforcement office or courthouse which will have metal detectors and screenings prior to entry.

Departments could also consider a ban on conducting interviews in a subject’s home, the guidance notes.

The Market Regulation Committee document says insurance departments should consider requiring refresher safety training sessions on an annual basis. In addition to this program, departments may want to consider regular training sessions with local law enforcement authorities.