Chapter 15: Ethics and Social Responsibility

History of Insurance


One of the biggest cases of health insurance fraud occurred in 1991. Two brothers set up mobile medical labs in several states to conduct unnecessary tests on unsuspecting patients. In addition, they submitted claims for tests that were not performed. The brothers were arrested and convicted. They admitted to taking more than $1 billion in the fraud.

The trail of insurance fraud is littered with some truly ridiculous cases, most of which have resulted in convictions, prison sentences, and large monetary fines. (Insurance fraud that involves income tax fraud or mail fraud become federal cases). Here are some of the more jaw-dropping examples.