Information On Auto Insurance Fraud

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What Is The Penalty For Insurance Fraud ?

Insurance fraud occurs every day of our lives and in every state of the US. In fact, when it comes to insurance fraud, people from races, incomes and ages are victimized. It is estimated that insurance fraud costs American an average of $80 billion each year, which roughly works out to $950 for each family.More...

Information On Auto Insurance Fraud

If you become a victim of auto insurance fraud, you will have to pay higher premiums because you will end up with an expensive claim.

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It is important that you understand about auto insurance fraud so that you can protect yourself from those unscrupulous people who might choose you to part of their next fraud.

Insurance fraud has been around for centuries. It was even present in ancient Greece where ships were purposely sunk to collect insurance. Later on these scams made their way to England and from there to America. Once automobiles were introduced, it opened an entirely new avenue for fraudulent insurance claims. Today, there are sophisticated crime rings that make money from insurance fraud.

Here is a list of common auto insurance fraud scams that are rampant all around us:

Staged rear end car accident: A driver quickly gets in front of an innocent car and then slams his brakes. This causes the innocent driver to hit the rear end of the car. The driver will collect insurance money for the damage caused to his vehicle and many times he will also fake medical injuries so that he can collect more money.
Adding damage: After an accident, be it staged or real, the driver go to another location and cause more damage to his vehicle and then claim that the damaged occurred during the original accident.
Fake helpers: In this auto insurance fraud, a helper waves an innocent driver into the traffic and then deliberately crashes into his car. He then denies waving the driver into traffic and files for a claim. The other way fake helpers operate is offering help to drivers by directing them to an auto repair shop, doctor or lawyer. Here, every person involved is a cheat and the innocent driver will have to shell out more money than usual.

These scams can happen at any time and at any place. That is why it is important that you are prepared. Being aware that these scams actually occur is important. You should keep a look out for drivers who might be following you or checking your driving habits. If you do get into an auto insurance fraud scheme, make sure you inform your insurance company about your suspicions.

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