DOW JONES NEWSWIRES
Allstate Corp. (ALL) said it is suing dozens of people in New
York for insurance fraud and seeking recovery of $6.3 million,
while reiterating calls for change in the state.
The suit, which names 83 defendants in New York, alleges that
they engaged in separate schemes to submit fraudulent and
misleading bills to Allstate for durable medical equipment, medical
supplies and orthotic devices. It's the company's seventh insurance
fraud lawsuit this year and its 34th in New York since 2003.
The Insurance Information Institute trade group has said
insurance fraud is at a crisis level in New York, the company
said.
Allstate spokeswoman Krista Conte reiterated the company's
stance from earlier this year, that the level of fraud amounts to a
"fraud tax" on honest insurance consumers by forcing premiums
higher. She also reiterated the company's call on lawmakers to
"enact meaningful insurance reform."
Lately, Allstate's bottom line has at times suffered from
catastrophe losses. In the latest period, earnings fell 55% because
of disasters, while the insurer's operating profit also declined
but stayed out of the red.
Allstate shares were down 0.2% at $27.03 in recent trading. The
stock has fallen 15% so far this year.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com