Current through 2021-2022 Regular Session Chapter 307
Section 33-1-16 - Investigation of fraudulent insurance act; collection of evidence; immunity from liability; public inspection; enforcement(a) For the purposes of this Code section, a person commits a "fraudulent insurance act" if he: (1) Knowingly and with intent to defraud presents, causes to be presented, or prepares with knowledge or belief that it will be presented, to or by an insurer, purported insurer, broker, or any agent thereof, any written statement as part of, or in support of, an application for the issuance of, or the rating of, an insurance policy, or a claim for payment or other benefit pursuant to an insurance policy, which he knows to contain materially false information concerning any fact material thereto or if he conceals, for the purpose of misleading another, information concerning any fact material thereto; or(2) Knowingly and willfully transacts any contract, agreement, or instrument which violates this title.(b) If, by his own inquiries or as a result of information received, the Commissioner has reason to believe that a person has engaged in, or is engaging in, a fraudulent insurance act, the Commissioner may administer oaths and affirmations, request the attendance of witnesses or proffering of matter, and collect evidence. The Commissioner shall not compel the attendance of any person or matter in any such investigation except pursuant to subsection (d) of this Code section.(c) If matter that the Commissioner seeks to obtain by request is located outside the state, the person so requested may make it available to the Commissioner or his representative to examine the matter at the place where it is located. The Commissioner may designate representatives, including officials of the state in which the matter is located, to inspect the matter on his behalf, and he may respond to similar requests from officials of other states.(d)(1) The Commissioner may request that an individual who refuses to comply with any such request be ordered by the superior court to provide the testimony or matter. The court shall not order such compliance unless the Commissioner has demonstrated to the satisfaction of the court that the testimony of the witness or the matter under request has a direct bearing on the commission of a fraudulent insurance act or is pertinent or necessary to further such investigation.(2) Except in a prosecution for perjury, an individual who complies with a court order to provide testimony or matter after asserting a privilege against self-incrimination, to which he is entitled by law, may not be subjected to a criminal proceeding or to a civil penalty with respect to the act concerning which he is required to testify or produce relevant matter.(3) In the absence of fraud or bad faith, a person is not subject to civil liability for libel, slander, or any other relevant tort by virtue of filing reports, without malice, or furnishing other information, without malice, required by this Code section or required by the Commissioner under the authority granted in this Code section, and no civil cause of action of any nature shall arise against such person: (A) For any information relating to suspected fraudulent insurance acts furnished to or received from law enforcement officials, their agents, or employees;(B) For any such information relating to suspected fraudulent insurance acts furnished to or received from other persons subject to the provisions of this title; or(C) For any such information furnished in reports to the Commissioner or the National Association of Insurance Commissioners.(4) The Commissioner or any employee or agent is not subject to civil liability for libel, slander, or any other relevant tort, and no civil cause of action of any nature exists against such persons by virtue of the execution of activities or duties of the Commissioner under this Code section or by virtue of the publication of any report or bulletin related to the activities or duties of the Commissioner under this Code section.(5) This Code section does not abrogate or modify in any way any common law or statutory privilege or immunity heretofore enjoyed by any person.(e) The papers, documents, reports, or evidence relative to the subject of an investigation under this Code section shall not be subject to public inspection for so long as the Commissioner deems reasonably necessary to complete the investigation, to protect the person investigated from unwarranted injury, or to be in the public interest. Further, such papers, documents, reports, or evidence relative to the subject of an investigation under this Code section shall not be subject to subpoena until opened for public inspection by the Commissioner, unless the Commissioner consents, or until, after notice to the Commissioner and a hearing, a superior court determines the Commissioner would not be unnecessarily hindered by such subpoena. The Commissioner or his employees or agents shall not be subject to subpoena in civil actions by any court of this state to testify concerning any matter of which they have knowledge pursuant to pending investigations of fraudulent insurance acts.(f) Any person, other than an insurer, agent, or other person licensed under this title, or an employee thereof, having knowledge of or who believes that a fraudulent insurance act is being or has been committed may send to the Commissioner a report of information pertinent to such knowledge of or belief and such additional information relative thereto as the Commissioner may request. Any insurer, agent, or other person licensed under this title, or an employee thereof, having knowledge of or who believes that a fraudulent insurance act is being or has been committed shall send to the Commissioner a report or information pertinent to such knowledge or belief and such additional information relative thereto as the Commissioner or his employees or agents may require. The Commissioner or his employees or agents shall review such information or reports as, in the judgment of the Commissioner or such employees or agents, may require further investigation. The Commissioner shall then cause an investigation of the facts surrounding such information or report to be made to determine the extent, if any, to which a fraudulent insurance act is being committed and shall report any alleged violations of law which the investigations disclose to the appropriate prosecuting attorney having jurisdiction with respect to any such violation. If prosecution by the prosecuting attorney is not begun within 90 days of the report, the prosecuting attorney shall inform the Commissioner of the reasons for the lack of prosecution.(g) Notwithstanding the provisions of subsection (f) of this Code section, when an insurer or an insured knows or has reasonable grounds to believe that a person committed a fraudulent insurance act and which the insurer reasonably believes not to have been reported to a law enforcement agency in this state, then, for the purpose of notification and investigation, the insurer or an agent authorized by an insurer to act on its behalf or the insured may notify such law enforcement agency of such knowledge or reasonable belief and provide such information relevant to the fraudulent insurance act, including, but not limited to, insurance policy information, including the application for insurance; policy premium payment records; history of previous claims made by the insured; and other information relating to the investigation of the claim, including statements of any person, proofs of loss, and notice of loss. In the absence of fraud or bad faith, no insurer or agent authorized by an insurer to act on its behalf, law enforcement agency, or their respective employees or an insured shall be subject to any civil liability for libel, slander, or related cause of action by virtue of filing reports or for releasing or receiving any information pursuant to this subsection. For the purposes of this Code section, the term "law enforcement agency" shall mean and include any federal, state, county, or consolidated police or law enforcement department and any prosecuting official of the federal, state, county, local, or consolidated government. For the purposes of this Code section, the term "insured" shall mean and include any person who is a named insured or beneficiary under a policy or contract of insurance or a person who is not a named insured or beneficiary under a policy or contract of insurance due to the fraudulent action of another but who in good faith believes himself to be such an insured or beneficiary.(h) Personnel employed by the Commissioner under this Code section shall have the power to make arrests for criminal violations established as a result of investigations only. The general laws applicable to arrests by peace officers of this state shall also be applicable to such personnel. Such personnel shall have the power to execute arrest warrants and search warrants for the same criminal violations; to serve subpoenas issued for the examination, investigation, and trial of all offenses determined by their investigations; and to arrest upon probable cause without warrant any person found in the act of violating any of the provisions of applicable laws. Personnel empowered to make arrests under this Code section shall be empowered to carry firearms or other weapons in the performance of their duties. It is unlawful for any person to resist an arrest authorized by this Code section or in any manner to interfere, either by abetting or assisting such resistance or otherwise interfering, with personnel employed by the Commissioner under this Code section in the duties imposed upon them by law.