Be warned — submitting false replacement services forms will forfeit a car crash victim from receiving Michigan auto No Fault benefits
I’ve represented several hundred Michigan car crash victims in my 22 years as an auto accident attorney. Almost everyone tries to tell the truth (despite what the insurance companies might say).
But it is easy to make a mistake. And these days making a mistake on replacement service forms after a car crash in Michigan can have devastating consequences.
So, it goes without saying, but I will say it anyway:
Car crash victims must never lie to their No Fault auto insurer about having received replacement services — or any other treatment or service such as attendant care — that they didn’t actually receive.
Let’s start with the worst-case scenario: someone is intentionally lying or making false representations on submitted replacement forms to the auto insurance company.
Making false statements or submitting false documents to a Michigan car insurance company in support of a claim for No Fault benefits is NEVER a good idea. Here are a couple of reasons why:
- This will likely get you disqualified from receiving auto No Fault insurance benefits through the Michigan Assigned Claims Plan.
- This will likely get you disqualified from receiving No Fault and other benefits under the “fraud exclusions” that have become increasingly common in personal auto insurance policies in Michigan — and that are being enforced by our courts in a serious of very poorly reasoned judicial decisions.
- It will undermine your credibility on all other aspects of your claim for No Fault benefits — and it can be used by the insurance defense lawyers in your third-party tort, also known as a pain and suffering case for your injuries from the car crash against the wrongdoer driver and his or her insurance company, to defend the case and attack your credibility as well.
- It’s insurance fraud and, under Michigan’s Insurance Code, a “fraudulent insurance act” is a “felony punishable by imprisonment.” (MCL 500.4503 and 500.4511)
Even if you didn’t know about the statute for insurance fraud, I’m assuming all of this seems obvious, right?
You probably don’t need an auto accident lawyer to tell you not to intentionally lie or commit No Fault insurance fraud.
But Michigan has taken this a bridge too far, in my opinion. We’ve never seen the rash of new cases in the last few years where judges are willing to “impute” fraud from very questionable circumstances. It’s very easy for a jaded insurance adjuster to scream “fraud” when someone makes a mistake on a calendar. And I’ve always said that a good defense lawyer who combs through medical records can always find something because no one — and I mean no one — can remember what they said to a doctor 10 or 20 years ago. Speaking of doctors, these new electronic medical records also means that mistakes on history are more common than ever as doctors struggle with new technology.
But any mistake, no matter how innocent, can now jeopardize your ability and right to collect auto No Fault insurance benefits that you’ll need for your care, recovery or rehabilitation after a bad car accident.
And lying isn’t going to jeopardize your ability to collect PIP (No Fault) benefits. It will eliminate it.
Apparently, someone didn’t get the memo.
How to account for ‘replacement services that were never provided’?
In Candler v. Farm Bureau Mutual Insurance Company of Michigan, the Michigan Court of Appeals ruled that Candler was disqualified from receiving No Fault benefits because — as his lawyer “conceded” — he “had signed his brother’s name” to calendars “for replacement services that were never provided.”
In so ruling, the Court relied on the No Fault Law’s rules for submitting claims to the Michigan Assigned Claims Plan (which provides No Fault benefits to uninsured car accident victims such as pedestrians, passengers, and bicyclists):
A claim to the MACP (which is administered by the Michigan Automobile Insurance Placement Facility (MAIPF)) “that contains or is supported by a fraudulent insurance act … is ineligible for payment of benefits under the assigned claims plan.” (MCL 500.3173a(2))
Is lying about replacement services a fraudulent insurance act?
The Michigan Court of Appeals in Candler thinks so.
Specifically, the court noted:
“[W]e hold that there is no genuine issue that a fraudulent insurance act, as defined by MCL 500.3173a(2), was committed when the August, September, and October 2015 calendars were submitted in support of a claim to the MAIPF for replacement services that were never provided.”
The Court of Appeals reached this conclusion based on the following:
- “There is no dispute that plaintiff submitted a claim to the MAIPF to recover no-fault benefits after being injured in a motor vehicle accident.”
- “There also is no question that a false statement was presented to defendant in support of plaintiff’s claim.”
- “[T]he evidence shows that plaintiff knew that the calendars he submitted for the months of August, September, and October 2015 were not correct.”
- “Plaintiff’s counsel conceded at the trial court that plaintiff signed/forged [his brother’s] name to the calendars.”
- “Further, during this three-month period, plaintiff knew that he moved to Detroit to be with his girlfriend, who then supplied the replacement services that [his brother] previously supplied.”
Notably, Michigan’s Insurance Code defines a “fraudulent insurance act” to include, but not be limited to, “acts or omissions committed by any person who knowingly, and with an intent to injure, defraud or deceive” such as:
“Present[ing] or caus[ing] to be presented to … any insurer, any oral or written statement including computer-generated information as part of, or in support of, a claim for payment or other benefit pursuant to an insurance policy, knowing that the statement contains false information concerning any fact or thing material to the claim.” (MCL 500.4503(c))
This is an important case for all Michigan auto accident lawyers. This is part of the heart-to-heart you have to have with all clients early on explaining that you have to be especially careful on any insurance forms.
And obviously, you should never lie.