Car insurance fraud such as auto theft, fires and staged car accidents are on the rise due to members of a stressed society reverting to criminal acts to pay their bills. Rather than allow his recently-purchased new car from being repossessed because he lost his job and can’t pay the monthly payment, a desperate man drives his car into the desert and sets it on fire. A group of criminals has a well-organized way to defraud car insurance companies by staging car accidents to collect on falsified medical and car repair bills.
Some policy holders will claim residency in an upscale neighborhood rather than pay more for their car insurance policy because they live in a high risk crime area. Mistakenly rationalized as a “victimless” crime, these soft forms of car insurance fraud still claim victims who end up paying more for their car insurance.
Car Insurance Fraud Claims
Car insurance fraud claims are responsible for an extra $300 in car insurance rates for every policy holder. The National Insurance Crime Bureau combats fraudulent car insurance claims through analysis of criminal data, investigation, education, political action, and public awareness.
The initiators of fraudulent insurance claims are a diverse group which includes members of organized crime, dishonest healthcare providers, legal professionals, car repair outfits, as well as the couple next door. Most insurers now maintain highly trained Special Investigation Units which, like a drug-sniffing dog, are onto the scent of every car fire, stolen vehicle or suspicious injury accident insurance claim.
Most importantly, the National Insurance Crime Bureau recognizes the value of public awareness in its car insurance fraud eradication effort. The NICB operates a toll free number, 1.800.TEL.NICB (1.800.835.6422) which accepts anonymous information about a suspected car insurance fraud claim. Individuals can help prevent some of these crimes by installing anti-theft devices such as the LoJack Theft Prevention System in their vehicles. Many insurers now offer a car insurance discount of up to 30 percent off your rates.
Although we are in a period of economic drought, car insurance fraud is not a solution, but rather a surrender to behavior of a lesser society in which self-respect is the real victim.