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Staged accidents: How to steer clear of car insurance scammers

By Posted : 11/12/2010

Staged accidents: How to steer clear of car insurance scammersStaged accidents are a growing crime across the country that defrauds car insurance companies and leads to higher auto insurance rates for honest policyholders.


These crooks try to profit from your misfortune, and it all happens in a flash. In some cases, con artists stage accidents using only their own vehicles and a few associates. In others, they target innocent drivers.

Among the tactics noted by the National Insurance Crime Bureau:

  • The swoop and squat. One car drives in front of you, and another pulls up next to you on the highway so you can't change lanes. The driver ahead slams on the brakes, causing a rear-end collision.
  • Jump-ins. Following the accident, several people appear out of nowhere and jump in the other cars, claiming to have been passengers all along.
  • Runners and cappers. These scammers show up at the accident scene and try to entice you to go to certain attorneys or medical clinics.
  • Left-turn drive down. A driver motions you to turn left in front of his car. But as soon as you start, he pulls forward to block your way and another car accelerates and slams into you.
  • Right turn drive down. As you make a right turn from a stop sign, a car that was parked at the curb zooms forward and hits your rear corner. The driver then claims you pulled in front of him or ran the stop sign.

When police arrive, the other driver and passengers complain of aches and pains and blame you for the accident. Later, they file thousands of dollars in claims for injuries against your car insurance company.

"Most of the damage is done by groups of people who make their living doing this," says Frank Scafidi, spokesperson for the National Insurance Crime Bureau. "They're knuckleheads, really."

Car insurance scams promise lucrative payoff

Last year, property insurers referred 28,553 suspicious medical claims to the National Insurance Crime Bureau, a 10 percent increase from 2008. Seventy-one percent of these were personal auto insurance claims.

The bureau projects if the current pace of questionable claims in the first half of 2010 continues, the total will rise 13 percent this year compared to 2009.

Con artists are becoming more sophisticated and organized, says Bob Cline, national special investigative unit manager for Esurance, an online direct-to-consumer insurance company headquartered in San Francisco.

The crooks work with shady clinics and attorneys, use fictitious names and vehicles that can't be traced to previous accidents, and recruit witnesses and passengers with no criminal histories. In many cases, these recruits are recent immigrants unfamiliar with the legal system.

Another trend Cline sees is the growing involvement of street gangs drawn by a lucrative payoff. Until recently, most of the groups that pulled off auto insurance scams were specialists not involved in other criminal activity.

Florida, California, New York, Texas and Illinois are the top five states for questionable medical claims, according to the bureau. The top five cities are New York; Tampa, Fla.; Miami; Los Angeles and Houston.

"Central Florida is the staged accident capital of the country," Cline says.

A 2010 study by the National Insurance Crime Bureau shows the number of insurance claims related to suspected staged or deliberately caused accidents jumped 58 percent in Florida from 2008 to 2009. Tampa is now at the epicenter of the trend, according to the bureau.

Steering clear of staged accidents

Car insurance scammers look for victims who are alone and drive nice cars likely to be well-insured, Scafidi says.

"They're not going to pick on somebody driving a beater," he says.

Seniors and women are more at risk than men and younger people. Cline says crooks also prey on distracted drivers. Some scammers who have pled guilty told investigators they looked for drivers talking on cell phones.

If you're in an accident, trust your gut if anything seems fishy. Report suspicions immediately to your car insurance company.

"Gather as much information as possible when reporting potential instances of fraud, including names and dates, phone numbers, addresses, amount of money involved, documentation and any other information you think is helpful," Loznicka says.

Here are other tips from the bureau to avoid or fight car insurance medical fraud:

  • Don't tailgate. Leave plenty of room to avoid rear-ending the car in front of you if it stops suddenly.
  • Call police. Get a copy of the police report with the officer's name, even if there's minimal damage, advises the National Insurance Crime Bureau. That makes it harder for crooks to intentionally cause more damage later and file bigger claims with the insurance company.
  • Record the details. Take pictures at the accident scene and write down as much information as you can.
  • Remain on alert. Be wary of tow trucks that arrive without anyone having called for service, doctors who pressure you to file personal injury claims when you're not hurt, and people who appear on the scene and direct you to certain clinics and attorneys.


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