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The High Price Of Car Insurance Scams

May 10, 2008
Auto insurance fraud has many victims-some obvious, some not so obvious. Clearly, car insurance scams can lead to injuries, even fatalities. A frequent scam is the \"staged accident,\" in which con artists force innocent drivers into accidents so that they can collect against the victim's car insurance. These can easily lead to death or serious injury.

But there are also substantial financial costs associated with insurance fraud, and these have widespread consequences. In the state of New York, Senator Charles Schumer's office found that car insurance scams cost each driver in New York about $200 a year, for a total of 1 billion dollars. Car insurance quote numbers skyrocket because someone has to pay for all of these claims.

How do we know if we are victims of fraud? Knowledge and skepticism are our best defense. Know all the common con artist schemes, and be sure to collect all information from the other party involved in the accident.

The \"Scoop and Squat\" is easy to spot and commonly used. Two scammers in separate cars box in a victim and force a rear-end accident. They do this by driving closely in front and directly to the side of the innocent driver. The car in front slams on its brakes, leaving the victim not enough room to stop, and no exit to the other lane. The victim is powerless to stop the accident.

Another common con used in car insurance scams is the \"T-Bone.\" This highly dangerous operation involves intentionally ramming into the side of a car in an intersection, as it passes a light or stop sign. The con artist is aided by confederate witnesses who all claim that the victim ran the light or sign. This type of hit often results in injuries, as many cars do not have side airbags and the attacking car can make direct contact with the driver or passenger.

Even if the accident is legitimate, that still does not mean that there isn't a car insurance scam waiting to happen. Unscrupulous repair shops can inflate the cost of repair, claiming damage that did not occur, or exaggerating the seriousness of the damage. They may even declare the car \"totaled,\" which means it would cost more to fix it than it is worth, and then sell the car to a chop shop for parts, or to be put back on the road with fake identification numbers and paperwork.

How do we protect ourselves from car insurance cons? Defensive driving is the first and best defense. If you are in an accident, be observant and aware of the other drivers, passengers, and witnesses. Fully documenting the accident is vital: Take pictures and collect information from everyone involved. This helps authorities catch car insurance cons, and gives you full photographic detail of the damage done to your car.

Second, make sure you work only with reputable repair shops. Your insurance company can often recommend a shop with which they have extensive experience. No matter what, make sure you get an itemized copy of the repair description, and question anything that seems out of line. You can also take this to another shop for a second opinion.

Car insurance scams can ruin good driving records, cause injuries and higher premiums, or worse. It's no wonder that the average driver might feel angry, and even helpless to stop it. The good news is that by gaining a little knowledge of common scams, and by writing down a lot of evidence in the event of an accident, we can make driving cheaper, and safer.
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