If you are involved in an accident and if something tells you that there is something odd, then there probably is. It could either be the accident itself or the events that unfold in the days and weeks following the accident. There is every possibility that you and your insurer are being fooled.
Staged accidents cost insurers and policyholders billions of dollars annually according to the Insurance Information Institute (I.I.I). These staged accidents had become very common especially during the recession. Insurance scams can take many forms. There might be the involvement of local street thugs, entry level thieves, organized crime syndicates etc.
Loretta Worters, VP, I.I.I., states that these staged accidents could be a dangerous criminal activity as the innocent drivers are most often targeted with some really bold schemes which are aimed at defrauding insurance companies.
The backdrop for these scenarios is generally the urban areas and this is literally the hub for fraud and staged auto accidents. However, contrary to what one might think, these occur more frequently in the wealthier areas rather than the poorer ones, because this is where the people are more likely to have full coverage.
The states where there is maximum number of staged accidents are the ‘no-fault’ insurance states as the I.I.I has pointed out.Out of the 12 U.S. states that have the no-fault laws, Florida is leading right now with questionable claims that involve staged accidents. This is followed by New York, Michigan, and New Jersey.
There are a few telltale signs that you are part of a staged accident and these are some of the warning signs:
- People appear at the accident site and direct you to particular clinics or attorneys.
- Even if you aren’t hurt, the physician will insist that you file personal injury claim.
- The tow trucks arrive even without a call.
- There are inflated claims and misrepresented facts after the accident.
There has been a 26% rise in staged accidents in 2010 and there has been an inflation in the auto body or auto repair claims too as it has risen by 31%. The auto glass fraud has risen to a whopping 450% a year.
In case you are unsure that you are part of an insurance scam, it is still better to report your suspicion. This way, it would be more difficult to inflate the claim where the damage may seem more extensive. This will help prevent future scams as well.
