insurance premiums go towards covering costs
of fraudulent car insurance claims. Additionally,
insurance crimes such as staged accidents and
fraudulent insurance claims use up valuable law
enforcement, health care, and legal resources.
Not only do insurance crimes limit the number
of resources available for people who actually
need them, but they also cause increased taxes
in order to fund the illegitimate use of public
services. Thus, insurance fraud costs all of us,
both personally and financially.
What does auto insurance fraud look like?
Some fraud is intentional and obvious, while
other forms are more subtle. Some of the most
common types of auto insurance fraud activities
are these:
• Staged accidents – An individual or a group of
individuals may plot to orchestrate an accident in
order to file or inflate an insurance claim.
• Lying on a policy – Someone omits or lies
about information when applying for an auto
insurance policy. Some refer to this as ‘auto
premium evasion.’ An example of this is failing to
add another driver to a policy, such as a teenage
driver. Omitting this information is fraud.
• Lying about the loss – Reporting that a loss
occurred in any way other than how it actually
happened is fraud. Doing so is common when
people don’t want to admit they were at fault and
then adjust the details of the event.
• Falsifying services or treatments –
Falsification results from a health care provider,
auto body shop or another related professional
claiming that treatment was given or services
provided that weren’t in order to inflate an
insurance claim.
What can you do about insurance fraud?
Recognize. Reject. Report. The idea is simple.
Recognize fraudulent auto insurance activities;
reject participating in fraudulent activities;
report suspicious auto insurance activities to the
police and to your insurance provider.
If you are in an accident, always work directly
with your insurance provider and only with body
shops that you trust. Be wary of recommendations
or referrals made on site by others involved in the
accident and be sure to report this activity to your
insurance provider.
By working together to inform ourselves, to
protect ourselves, and to apply the right kind of
pressure, in the right kinds of places, we can effect
meaningful change to control the costs that drive
up the rates of insurance.
If you have any questions about your car
insurance, be sure to call your insurance broker. ●
news&views SUMMER 2019 | 55