Fraud Eliminates Right to No Fault Benefits
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Post 5091
Court Eliminates an Attempt to Defraud No Fault Placement Facility
Aric Lynn Holloway II (plaintiff), appealed the stipulated order of dismissal in favor of defendant-appellee, Citizens Insurance Company of the Midwest (defendant).
In Aric Lynn Holloway II, et al v. Memberselect Insurance Company et al, Michigan Automobile Insurance Placement Facility, No. 367611, Court of Appeals of Michigan (May 29, 2025) the plaintiff attempted to convince the Court of Appeals to allow his fraud to succeed.
In a case involving issues of insurance claims, alleged fraud, and the eligibility for Personal Injury Protection (PIP) benefits the Court of Appeals affirmed the trial court.
FACTUAL BACKGROUND
The case arises from a car accident where the plaintiffs, Holloway and his friends, were rear-ended by another vehicle that fled the scene. Holloway sustained various injuries and underwent spinal surgery at Advanced Surgery Center (ASC), assigning his right to PIP benefits to ASC only to find Holloway had committed fraud.
Holloway sought PIP benefits through MemberSelect Insurance Company, which was issued to his parents, and also applied for benefits through the Michigan Assigned Claims Plan (MACP).
Holloway’s application stated he lived with his girlfriend and daughter, indicating no vehicles were owned in the household. However, he later testified he lived with his parents at the time of the accident. His application included false service dates for attendant-care services, which raised suspicions of fraud.
LEGAL PROCEEDINGS
ASC intervened in the lawsuit to recover PIP benefits it provided to Holloway. Eventually, Citizens moved for summary disposition, arguing that Holloway committed fraudulent acts by submitting false information in his claims.
The court found that Holloway’s claims were based on knowingly false statements, which included fabricated service dates and misrepresentation of his living situation. The court ruled that he was ineligible for PIP benefits due to fraud.
JURISDICTIONAL ISSUES
The court concluded that Holloway was an aggrieved party following the final order dismissing his claims.
SUMMARY DISPOSITION AND FRAUD FINDINGS
The court granted summary disposition in favor of Citizens Insurance, concluding that Holloway’s actions constituted a fraudulent insurance act as defined under Michigan law. The court emphasized that the statements made in his application and affidavits were material to his claim, and he was aware they were false.
Holloway’s assertions that discrepancies were innocent mistakes were rejected. The court found no genuine issue of material fact regarding his knowledge of the false information he submitted.
CONCLUSION
Ultimately, the court dismissed Holloway’s claims for PIP benefits based on the determination that he committed insurance fraud.
When a person injured in a motor vehicle accident lacks insurance, the no-fault act sets forth an order of priority for insurers who may be liable for the payment of PIP benefits. The Court held that a person commits a “fraudulent insurance act” when
1 the person presents or causes to be presented an oral or written statement,
2 the statement is part of or in support of a claim for no-fault benefits, and
3 the claim for benefits was submitted to the MAIPF.
4 the person must have known that the statement contained false information, and
5 the statement concerned a fact or thing material to the claim.
Viewing the evidentiary record in the light most favorable to plaintiff, the court found no genuine issue of material fact that plaintiff committed a fraudulent insurance act.
The record indicates that plaintiff was aware that the attendant-care and replacement-services affidavits he submitted were incorrect.
The Court concluded that Plaintiff failed to demonstrate the existence of a genuine issue of material fact to preclude summary disposition.
ZALMA OPINION
No Fault insurance was designed to help injured people and take the profit out of fraud because of the limited awards for no fault accidents. In this case fraud was obvious, the plaintiff admitted he lied in his deposition but claimed it was just a mistake not an intent to deceive. The argument failed because the evidence established that he intentionally and incompetently committed fraud. Crime doesn’t pay and he will have to pay for his surgery out of his own funds.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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The Professional Claims Handler
Post 5218
Read the full article at https://www.linkedin.com/pulse/zalma-philosophy-claims-handling-part-8-barry-zalma-esq-cfe-zdwsc, see the full video at https://rumble.com/v70zl4s-the-zalma-philosophy-of-claims-handling-part-8.html and at https://youtu.be/MIYcF71ffRQ, and at https://zalma.com/blog plus more than 5200 posts.
Claims Commandment X – Thou Shall Not Pretend to be a Lawyer
Some experienced and professional claims people know the law in their area of expertise better than most lawyers.
Adjusters should be adjusters and leave lawyering to lawyers. Similarly, lawyers should be lawyers and never try to be adjusters.
Claims Commandment XI – Thou Shall Empathize With the Claimant
Everyone presenting a claim is unhappy, disturbed, shocked, injured and needs help.
Empathy is identification with and understanding of another’s situation, feelings, and motives. It is the ability to understand another person’s circumstances, point of view, thoughts, and feelings....
HOW TO CREATE AN EXCELLENCE IN CLAIMS HANDLING PROGRAM
See the full video at https://rumble.com/v70wb2i-the-zalma-philosophy-of-claims-handling-part-6.html and at https://youtu.be/tL5nDKPEs40 and at https://zalma.com/blog plus more than 5200 posts.
Post 5217
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry.
An Excellence in Claims Handling program begins with a statement in the insurer’s claims manual or statement of professionalism that it is dedicated to providing excellence in claims handling to every insured who presents a claim.
The excellence in claims handling program should include, at a minimum:
A series of lectures supported by text materials explaining:
A definition of insurance.
How to read and understand an insurance policy.
How to interview an insured, witness, or claimant.
How to assist an insured in the insured’s obligation to ...
The Professional Claims Handler
Post 5216
Read the full article at https://www.linkedin.com/pulse/zalma-philosophy-claims-handling-part-5-barry-zalma-esq-cfe-jde8c, see the full video at https://rumble.com/v70q4x8-the-zalma-philosophy-of-claims-handling-part-5.html and at https://youtu.be/6b9tZQsEkB4, and at https://zalma.com/blog plus more than 5200 posts.
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry.
Standards to be a Professional Claims Adjuster
The Insurance claims professional should be a person who:
1. Can read and understand the insurance policies issued by the insurer.
2. Understands the promises made by the policy.
3. Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
4. Are competent investigators.
5. Have empathy and recognize the difference between empathy and sympathy.
6. ...
The Professional Claims Handler
Post 5219
Posted on October 31, 2025 by Barry Zalma
An Insurance claims professionals should be a person who:
Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
Understand how to repair damage to real and personal property and the value of the repairs or the property.
Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
How to Create Claims Professionals
To avoid fraudulent claims, claims of breach of contract, bad faith, punitive damages, unresolved losses, and to make a profit, insurers ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
