The bill amends the Michigan Insurance Code of 1956, specifically section 4511, to redefine the penalties associated with committing fraudulent insurance acts. It introduces a tiered penalty system based on the amount of the fraudulent claim and the number of claims involved. For instance, if the fraudulent claim is less than $1,000 or involves fewer than five claims, it is classified as a misdemeanor with a maximum penalty of one year in prison or a fine of up to $2,000. Conversely, more severe penalties are established for larger claims, with felonies punishable by imprisonment ranging from five to twenty years and fines up to $50,000, depending on the circumstances.

Additionally, the bill mandates that individuals found guilty of these offenses must pay restitution as outlined in existing laws. It also allows for the aggregation of fraudulent claims made within a 12-month period to determine the total amount involved, and it requires the prosecuting attorney to provide notice of any prior convictions when seeking enhanced sentences. The bill retains the requirement for courts to notify the appropriate licensing authority if a practitioner or insurer is found guilty of a fraudulent insurance act.

Statutes affected:
House Introduced Bill: 500.4511