Tuesday, June 18, 2013

Auto insurance Fraud on the Rise- Watch Out!

A car crash on Jagtvej in Copenhagen, Denmark.
(Photo credit: Wikipedia)
Last month’s twister in Oklahoma left more than deadly destruction and debris in its trail. While picking up the pieces, a number of people had to deal with a disaster of a different kind: insurance fraud, especially in cases related to automobiles. Authorities have reported that out of the 20,000-odd claims registered in the week following the tornado, a big chunk of those were concerning vehicles. To stop victims of the tornado from falling prey to auto insurance scams, the National Insurance Crime Bureau (NICB) has been working alongside the Oklahoma Insurance Department in identifying the people responsible in such cases.

Auto insurance scam numbers at a dizzying high

Recent surveys suggest that such incidences are neither restricted to occur in the aftermath of natural disasters nor in Oklahoma. In fact, D.C. recorded the highest rate of auto insurance fraud. At 83 questionable claims per 100,000 people, the country’s capital was leading when it came to the sheer volume of questionable claims considering its size and population. Maryland, California, Rhode Island and California rounded up the list of the top five states with a high rate of questionable claims.

Across the country, incidences of auto insurance fraud are on the rise and if numbers are anything to go by, there is no stopping fraudsters from making a quick buck. In a report published by the NICB, the percentage of questionable claims that were filed in 2012 jumped 13 percent from the previous year, with the number of questionable personal automobile claims increasing to 78,024 claims in 2012 from 69,219 claims filed the year before. In all, there were 209,724 questionable claims filed with the bureau when it came to all types of automobile insurance, many of them due to the growth in the number of staged accidents in the country.

These are startling numbers, given that you can never know what hit you, literally.
The NICB analysis also pointed out that at one-fifth of all questionable claims, those related to bodily injury were right on top. This is a cover through which other people’s injuries can be paid for if they were caused by the one insured. Closely following was the cover in case of collision, making up 16 percent of personal automobile claims, in which the one holding the insurance policy is paid, for the damages to his own car, incase no one else is involved.

Keeping insurance scams at bay

Cases of fraud can strike without much warning, no matter how experienced you may be as a driver. While the numbers keep rising by the day, you as the one insured, can keep track of how and where these scams strike.

A few pointers to protect yourself against fraudulent claims:
  • The auto insurance company or agent through which you access coverage should have a valid license.
  • Do not leave the site of the accident without first noting down details of the other driver. Information like phone numbers, license numbers, license plate numbers and insurance information should be noted down.  
  • Legal documentation of the accident is vital.
  • Be alert about all referrals at the time of the accident, be it auto repair shops or health and legal experts.
  • Avoid signing forms that you haven’t filled that may be related to health care or treatment for injuries caused by the accident.
  • Review your auto insurance policies and make sure you understand them well.
  • Always insist on bills for auto repairs and medical costs connected to the accident.
Older people are especially to be on guard against auto insurance frauds as they are more gullible because of their trusting nature. Seniors may want to take the help of AARP not only to get great discounts on car insurance but also to help them find coverage from an auto insurance carrier who can smell a rat when they see one!

Author Bio: Elvis Donnelly is a father of two who works from home and lives with his wife. He is voracious reader and always looks out for happening topics related to personal finance. He specializes on subjects related to insurance and uses his spare time to write on topics related to auto insurance, car insurance quotes etc.


  1. This article was very enlightening , because my cousin was just the victim of auto insurance fraud. As a senior my AARP insurance is so important as I recognize some people try and take advantage of the elderly and blame them for accidents when they may not have been at fault. It is essential to have the right insurance provider to ensure you are not a victim of one of these scams.

  2. Wow, this article is pleasant, my younger sister is analyzing automobile ins fraud news, so I am going to tell her.


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