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Market Conduct Examinations and Anti-Fraud Compliance Unit

Market Conduct Examinations

The Market Conduct Examinations Unit within the Office of Consumer Protection Services conducts on-site examinations of insurance company and agency operations and business practices to determine whether consumers, medical providers and other members of the public are being treated fairly and in accordance with New Jersey insurance laws. The unit examines life, health, managed care and property/casualty companies, with specialty lines reviewed as appropriate.  For insurers that are subject to N.J.S.A. 17:33A, the New Jersey Insurance Fraud Prevention Act, and N.J.A.C. 11:16-6, {transact private passenger automobile or health insurance in this State} the on-site examination also will include review to determine compliance with fraud prevention, detection and reporting standards required by law.

Consumer complaints, problems in the marketplace and other areas of concern identified by the Commissioner and Department staff are significant factors in determining which companies and lines of insurance will be examined. When potential areas of concern are identified, the unit strives to respond quickly with a targeted review of the affected companies.

Based on the findings of the examination, the Department issues a report that includes findings and recommendations to correct company procedures that adversely affect consumers or do not comply with our laws. Significant findings may result in further administrative action leading to fines, payments to consumers or additional benefits to policyholders. This market conduct examination process helps to promote a climate of fair competition in the marketplace, combat insurance fraud, and protect consumers from practices that are contrary to our insurance laws.
Anti-Fraud Compliance

Insurers that transact private passenger automobile insurance business in this State on either a personal lines or commercial lines basis, or transact health insurance business in this State are required to submit to the Department for approval a Fraud Prevention and Detection Plan, as required by N.J.A.C. 11:16-6.  Such plans must provide for the prevention and detection of fraudulent insurance applications and claims.  Generally, plans must include training programs, a Fraud Prevention and Detection Procedures Manual, requirements for the establishment and operation of Special Investigations Units, and procedures for the referral of suspected cases of insurance application or claim fraud to the Office of the Insurance Fraud Prosecutor.  The Anti-Fraud Compliance Unit is responsible for reviewing these plans to ensure that they meet the requirements set forth in N.J.A.C. 11:16-6.  In addition, the Anti-Fraud Compliance Unit is responsible for reviewing the Fraud Prevention and Detection Annual Reports to be submitted by all insurers subject to N.J.A.C. 11:16-6.
Automobile Insurance Identification Cards

This Automobile Insurance Identification Card Unit reviews and approves private passenger and commercial automobile insurance identification card filings to ensure compliance with anti-counterfeiting requirements outlined in N.J.A.C. 11:3-6.  In order to deter fraudulent use of insurance identification cards, insurers are required to file identification cards with the Department prior to use.  In order to confirm or rule out fraudulent duplication and use of counterfeited identification cards, the unit also serves as liaison to the New Jersey Motor Vehicle Commission (MVC) and state and local law enforcement agencies.  The unit performs this function by maintaining a confidential database of all cards and their respective anti-counterfeit measures, as well as a list of dedicated insurer telephone numbers where law enforcement personnel can contact insurers to confirm coverage on questionable identification cards.  A summary report of all approved cards is provided to MVC on a routine basis, and to law enforcement personnel and representatives of the Office of the Insurance Fraud Prosecutor as needed.
Anti-Fraud Prevention & Detection Experience Annual Report Forms

Automobile Insurers Health Insurers

Anti-Fraud Prevention & Detection Plan Specimens

More Information

Contact Information
Market Conduct Examinations &
Anti-Fraud Compliance Unit

PO Box 329, Trenton, NJ 08625
Clifton Day, Manager, Market Conduct and Anti-Fraud Compliance

Phone: 609-341-2513 ext. 50197

FAX:  609-292-5337
  Anti-Fraud Compliance Unit

Anti-Fraud Prevention and Detection Plans & Annual Report
Forms & Filings

Phone: 609-341-2513 ext. 50201



  Automobile Insurance Identification Card Unit

Phone: 609-341-2513 ext. 50197
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New Jersey Department of Banking and Insurance