Insurance fraud is a big problem for drivers and insurers. The Association of British Insurers (ABI) estimated that more than 113,000 rogue insurance claims were stopped during 2017, saving a whopping £1.3bn. in addition, some 449,000 dishonest insurance applications were also discovered. It’s not just the insurance companies that pay the price; Insurance fraud raises the price of premiums for all drivers. this is our advice to help you avoid becoming a victim and to avoid committing fraud yourself.
Reading: What is car insurance frauds
what is insurance fraud?
Anything that attempts to mislead your insurance provider, from knowingly providing false information for a quote to making an inflated claim after an accident. But it’s not just drivers who can be guilty of committing insurance fraud. If an insurance company knowingly denies a client a benefit that is owed to them, that is also considered fraud.
types of insurance fraud
Not including information, giving inaccurate details related to your age or driving experience, and ‘forgetting’ prior convictions or claims at the application stage are examples of this common type of insurance fraud. If you are found to have been dishonest in applying for your insurance, your payment could be restricted or your policy voided if you file a claim.
You have to be careful with even the smallest details when it comes to your application. even saying your car is being held in a driveway when it is actually being held on the road could be enough to be considered insurance fraud. Be honest about your annual mileage coverage – if you significantly exceed what you tell your insurer, they may not pay if you file a claim.
Fronting is where drivers try to save on their insurance by having a car insured in a parent’s name with a young driver as the ‘designated driver’. the drawback is that this is illegal if the youth drives the car most or all of the time. our research* shows that 49% of all drivers find this practice acceptable, rising to 60% for young drivers.
‘Fronting’ may get you a cheaper premium, but it will also make you guilty of fraud. If this is discovered after an accident, the insurer could void the policy, leading to prosecution for driving without insurance and possibly even prosecution for fraud. this would be a permanent stain on the record of both the young man and the father.
Insurers are alert to this practice and if they suspect someone is trying to ‘cope’ with a new policy, they may not offer a quote or assume the young person is the primary driver and quote accordingly. it is much better to insure a youngster legally so that he can start building his bond without claims and avoid the risk of getting himself and his parents into serious trouble.
There are easier ways to lower the cost of insurance for young drivers than committing a crime.
collision for money
This is when a driver intentionally causes an accident in order to file a claim; For example, 2 motorists plan to crash their cars and share the profits, or a single motorist causes an accident by hitting the brakes unexpectedly, so you can claim for a whiplash injury from your insurer. a dash cam is a sensible option to prevent this from happening to you.
Avoid becoming a victim of crash-for-cash by following our advice.
invented or exaggerated claims
If you are involved in a real accident but choose to exaggerate your injuries or damages in hopes of greater compensation, you are committing insurance fraud.
claiming for injuries to passengers who were not present at the scene of the accident is a common type of insurance fraud.
This is when someone gets rid of your car by dumping it somewhere, burning it, sinking it into a lake or river, or even selling it, and then files a claim pretending it was stolen and files a claim.
claiming damages for an accident that never happened is obviously insurance fraud. it is most commonly carried out by drivers using already damaged cars and trying to create the impression that the damage was caused by the accident.
how to avoid car insurance fraud
Honesty is the best policy. To make sure your auto insurance is legal and legitimate, remember to tell your insurer about:
- changes in your address or other circumstances.
- your mileage and if you are expected to change the use of your car after your original quote.
- other drivers mentioned in your policy.
- minor damage as well as more serious accidents, even if you don’t file a claim.
- penalty points or other convictions for driving.
insurance fraud complaint
If you have been in an accident and suspect you are the victim of insurance fraud, you can contact the Insurance Fraud Bureau (IFB) Helpline by calling 0800 422 0421 or by completing an online form.
To get an auto insurance quote with a default rating of 5*, contact us today.
*populus surveyed 24,070 aa members from March 8-15, 2017