Car Insurance Scams Are You A Target

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Car Insurance Scams Are You A Target?
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• Sometimes things arent what they seem at the
  scene of an accident, or even on the repair shop
  floor. Sometimes, accidents arent truly
  accidents at all. Car insurance fraud costs
  billions each year, and it isnt just the
  insurance companies footing the billwe all pay
  for auto insurance scams, whether were directly
  involved or not. Knowing how to spot common auto
  insurance scams can help keep you (and your car)
  protected.

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The Staged Accident

• Perhaps the most common type of car insurance
  fraud is faked accidents. Fraudsters will either
  prey on unsuspecting motorists, or they will set
  up the entire accident scenario, sometimes
  involving multiple cars, colluding witnesses, and
  crooked doctors and lawyers.

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• Robert Hartwig, president of the Insurance
  Information Institute, gave Quoted the details of
  how these scams work Faked accidents designed
  to result in fake injuries to the occupants of
  the vehicle are among the most common and costly
  of auto insurance scams.

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• This type of scam is designed to generate bogus
  claims payments to crooked medical service
  providers who treat these fake injuries. The
  occupants of the vehicle who fake these injuries
  are paid for their participation in the scheme.
  Getting in a car accident is bad enough. What's
  worse It might be the result of a premeditated
  effort.

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• Jordan Perch, from DMV.com, told Quoted that
  sometimes criminals will stage a rear-end
  accident. Perch said, This type of staged
  accident occurs when a scammer tries to force the
  driver behind them to hit them by slowing down or
  stopping abruptly on a busy street, or by pulling
  directly in front of another car and braking
  hard.

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Esurance details five main types of staged car
accidents (diagrams at the link)

• The Swoop and Stop
• The Panic Stop
• The Start and Stop
• The Wave In
• The Sideswipe

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• All of these types of accidents happen every day,
  for real, with no scammers in sight. However, if
  you are involved in one of these types of
  run-ins, you would do well to note these possible
  warning signs, from Esurance

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• A stranger at the accident scene refers you to a
  doctor, lawyer, or repair shopA physician
  (either one you were referred to or the other
  partys) pressures you to file a personal injury
  claim though you arent hurtA tow truck appears
  without being called

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• If you think youve been the victim of a staged
  accident, you can report it to the National
  Insurance Crime Bureau, your local police, or
  your insurance carrier.

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The Counterfeit Airbag

• Perch told Quoted that counterfeit airbags are a
  risk when the originals have been deployed and
  must be replaced. Perch said, Many mechanics
  replace original airbags with ones that have been
  manufactured abroad and are often unsafe. This is
  a great way for mechanics to make some extra
  profit by installing counterfeit parts while
  billing the drivers car insurance company for
  original, more expensive parts.

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• A dangerous scam 1 in 25 vehicles that have had
  airbags replaced were given counterfeit airbags.
  Airbag systems can cost between two and three
  thousand dollars to replace, and counterfeit, or
  altogether fake, airbags are easy to come by.
  CARFAX notes that a recent study found one out of
  every twenty-five vehicles that needed airbag
  replacement had fake or nonfunctioning airbag
  systemsa scary prospect in the event of a crash.

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• The first way to avoid becoming the victim of
  this dangerous scam is to have your repairs done
  by a mechanic you trust. You can also take your
  repaired vehicle into a certified airbag mechanic
  for a check. And, if youre shopping for a used
  car, be sure to have an independent mechanic
  inspect all airbags and verify they are present
  and working properly.

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The Phantom Victim

• Perch, of DMV.com, told Quoted that the phantom
  victim is one of the most common car insurance
  scams. Just how it sounds, after an accident
  fraudsters will file claims with the other
  partys insurance for people who werent in the
  accident, and werent on the scene at all. This
  scam could result from a staged accident, or it
  could be a crime of opportunity that occurs after
  a crash.

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• A good way to avoid becoming a victim here is to
  document as much as possible after an accident.
  The scene of an accident can be hairy, but
  remember to note how many passengers are present
  (and report this number to the police and your
  insurance carrier) and take photosof the other
  people involved in the wreck and of the general
  sceneif you can. Even a few cell phone snaps
  could stop this scam in its tracks.

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The Cost of Auto Insurance Scams

• Though these scams are horrifying all on their
  own, these crimes also substantially raise
  insurance premiums for every one of ussome
  reports claim scams like these cause everyones
  insurance to cost 200-300 more each year.

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• Jordan Perch told Quoted, Insurance frauds cause
  insurance companies to lose a lot of money, which
  they tend to make up for by raising the premiums
  for all of their customers.

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• According to the Coalition Against Insurance
  Fraud, staged accidents which are most common
  in New York, Florida and New Jersey are among
  the leading reasons why insurance premiums in
  these states are far higher than the national
  average. This organization estimates that fake
  auto insurance claims cost the national economy
  tens of billions of dollars each year.

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