Car Insurance Fraud Protection

If you have already been a victim of car insurance fraud then you know how costly, frightening and problematic it can be and how car insurance fraud protection will help. If you have not then read on, so you will not become a victim of this crime. The best form of car insurance fraud protection is to arm yourself with as much information as possible. Victims of car insurance fraud get victimized because they simply fell on the scammers trap most of the time.

What you should know is that insurance fraud is not something new. It goes as far back as the ancient times, when the ancient Greeks started purposely sinking ships for insurance. Today, car insurance scams cost billions of dollars for the consumers and the public. Not only do you pay additional for the cost of auto insurance scams, the cost of other products also increase since they also compute the price of insurance in how much they should charge for their products. So you actually pay twice for the insurance fraud.

The first thing you should know is that there are different types of auto insurance fraud but they are basically divided into two types, the hard and the soft… The soft frauds involve policy holders who simply pad their claim. Some even conspire with others, such as the body shop, to charge more. They generally just add additional damages in their claims. Hard fraud on the other hand, involves fraudsters staging accidents. Usually involving a rear end collision. The fraudsters invent injuries and even fake trauma to collect from your car insurance. There are even some who add people to their claim even though these people were not really present in the accident.

The hard car frauds are what you should really look out for. The most common type of this is the staged rear-end car accident. Basically one driver will get in front of your car and slam on the breaks, causing you to rear-end him. He will then collect money for what you had supposedly damaged. Expect him also to fake injuries so that he can collect more. Another scam is adding damage to the vehicle. Here, the scam driver will go to another place and add extensive damage to the vehicle. He will then claim that the damage was from the original accident. Next people to look out for are the fake helpers. Here the scam driver will wave you into the traffic only to crash into you. Then he will file the claim and will then deny that he waved you in.

The best protection from car insurance fraud is to have plenty of room in your front. Also, in case of an accident make sure you take plenty of photos. If you dont have a camera at the scene, you can also use your cell phone. You should also take down notes about everything so you dont forget later, because more chances then not you will end up in court over something minor. And at last inform your auto insurance company if you feel you are being scammed.

Car Auto Insurance Fraud Facts !

The first thing you should know is that insurance fraud actually costs you as much as $300 a year. Yes, that is according to the National Insurance Crime Bureau (NICB). In fact NICB stressed that since insurance rates are higher because of insurance fraud, companies charge you more for their goods and services. So you are actually paying more, not just for your insurance, because of insurance frauds.

Actually, there are different types of insurance fraud although they are basically classified as soft and hard fraud. The soft frauds are what are known as “build up” fraud. They involve the policy holder who pads their claim by adding previous damage to present claims. Some conspire with the claims adjuster or the body shop to increase the cost of repair estimate. While some conspire with doctors and add medical treatments in claim for higher charges. Hard insurance fraud on the other hand is more complicated since fraudsters invent or stage accidents covered in the insurance. Usually this involves rear end collision, injury claims that are not true and faking trauma that is due to the accident. Some even go to such extent as inventing adding people in the claim even though they were not actually present in the accident. Then of course there are those who claim hit and run on one-car accident.

Presently, there are an increasing number of fraudsters who report their cars stolen when in fact they abandon them or have then burn. This is because there are those who can no longer pay for their car and once the insurance company pays for the car then the policy holder will be able to pay for it without any effect on their credit rating.

Then of course there are organized fraud rings who participate in these crimes. These include doctors, mechanics, insurance people and lawyers. Together they defraud insurance companies for money but the long term effect of their work affects every citizen. Fraud, after tax evasion, is the second, most costly white collar crime in the US. In 2007, it is estimated that excess payments made by insurers amounted to about $6.8 billion. This does not even include the labor cost, cost on businesses, cost on law enforcement and other services. And although it is considered as invisible crime, the true cost of insurance fraud is felt mostly by the consumers and insurers.