Although car insurance fraud is a serious crime, people still routinely bend the rules for their own benefit, costing individuals and insurance companies money in the process. Insurance fraud is committed in a number of ways, including these common examples:
The Process of Registering a Vehicle in the Wrong State
If someone lies to his or her car insurance company about which state he or she lives in to receive lower rates, that person is committing insurance fraud. In fact, it’s against the law to register a vehicle in a state that does not serve as your primary residence. However, the financial incentive can be so great that some people have gone as far as parking their vehicle in a neighboring state just to give the appearance they are living there. Regardless, trying to get around this rule is an example of insurance fraud.
Falsifying a Stolen Vehicle Report
If a driver’s worst nightmare comes true and his or her car is stolen, it’s likely his or her insurance company will write a check for the cost of the car. Unfortunately, there are people who try to take advantage of this process, and may burn their car, dump it into a river, or hide it somewhere before reporting it is as stolen. They do this to collect the check and make a quick buck. This serious form of car insurance fraud will often result in jail time for perpetrators.
Exaggerating the Cost of Repairs Following an Accident
Another common tactic used in car insurance fraud is exaggerating the cost repairs after an accident. For example, some disreputable auto shops will use old, shoddy parts to fix a car, but then bill an insurance company for brand new parts. Alternatively, an individual or a shop may lie about how long the work took them to increase their invoice. Regardless, exaggerating the actual cost is a form of car insurance fraud.
If you are an insurance company that suspects fraud or you are a vehicle owner who worries you’ve been scammed, the experts at Law Dog Security & Investigations can help you find the answers you seek. For more information, call 773-233-5742.
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