Car insurance fraud rises in bad economy
Filed under: Insurance, Ripoffs and Scams, Transportation
Just as foreclosures and deed in lieu transactions are rising, an increasing number of Americans are also abandoning luxury cars they can no longer afford.
But some people are adding a creative twist: Instead of simply abandoning the car or handing the keys back to the lender, they're dumping them in ditches and then reporting them stolen hoping to collect a fat insurance settlement. Insurance claims are on the rise and the Wall Street Journal reports (subscription required) that "Authorities report a growing number of cars dumped in the Great Lakes, burned along remote New Jersey roadsides and driven into canals in California.
The phenomenon is acute in Las Vegas, where sharp declines in tourism and construction have left thousands of workers unemployed and broke."
If you're considering doing something like this, here's the best advice: Don't. Sure, there's a reasonably good chance that you'll get away with it but if you get caught you will probably end up in the slammer. Even if you don't get caught, you're participating in a scam that jacks up insurance costs for everyone else.
Another form of car insurance fraud that's also on the rise -- and can more directly victimize innocent bystanders -- is the "staged accident." Check out the video below.
But some people are adding a creative twist: Instead of simply abandoning the car or handing the keys back to the lender, they're dumping them in ditches and then reporting them stolen hoping to collect a fat insurance settlement. Insurance claims are on the rise and the Wall Street Journal reports (subscription required) that "Authorities report a growing number of cars dumped in the Great Lakes, burned along remote New Jersey roadsides and driven into canals in California.
The phenomenon is acute in Las Vegas, where sharp declines in tourism and construction have left thousands of workers unemployed and broke."
If you're considering doing something like this, here's the best advice: Don't. Sure, there's a reasonably good chance that you'll get away with it but if you get caught you will probably end up in the slammer. Even if you don't get caught, you're participating in a scam that jacks up insurance costs for everyone else.
Another form of car insurance fraud that's also on the rise -- and can more directly victimize innocent bystanders -- is the "staged accident." Check out the video below.
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Reader Comments (Page 1 of 1)
3-26-2009 @ 11:19AM
Motorandvanman said...
Great article, check out more news on car insurance at http://motorandvanman.blogspot.com.
Reply
3-26-2009 @ 8:04AM
Slim Cat said...
Rats of all kinds, big and small, from Wall Street to Main street, start showing up their faces--and tails--in a house fire.
It's not over yet; more waves of them will gradually make their appearances one after the other in due time.
What a country!
Reply
3-26-2009 @ 4:14PM
Gina said...
This is so sad! What may be worse is that research is showing that more and more people don't even think auto insurance fraud is a bad thing. Check out the article at http://www.insweb.com/news_features/auto_insurance_fraud_on_rise.htm
Reply
3-29-2009 @ 1:17PM
amit said...
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3-31-2009 @ 11:02AM
New York Auto Glass said...
Rats of all kinds, big and small, from Wall Street to Main street, start showing up their faces--and tails--in a house fire. This is so sad! What may be worse is that research is showing that more and more people don't even think auto insurance fraud is a bad thing.
http://www.autoglassguru.com/state-NY.html
Reply
3-31-2009 @ 4:27PM
brokebustedand said...
minimum slave waged who can say what will happen each day from the next before you know you might have to go and discover the under way to try to just get over so many no matter what they say just can't recover with the low pay allowed without any liveable means you have to get a tent and a raincoat for the growing clouds of mismanagement with failures all going down and payouts to those who are just out to clown before the end is nearer and they have to be clearer than ever about the why for their lie
Reply
5-07-2009 @ 2:55AM
Eliza said...
That's absolutely true, bad economy would automatically result in scams and frauds in different sectors
the article is gud and relates to reality
Eliza
Car Insurance
Reply
6-04-2009 @ 1:02AM
Sandi Geer said...
I know that there is fraud all the time. Farmers insurance agent.
Reply