Common Car Insurance Scams and How to Avoid Them

Staged accidents and fraudulent agents are just two of the common car insurance scams out there.

There are few things worse than getting involved in a car accident. Besides the possibility of personal injury, there’s also the damage caused to one of your most valuable assets, the trauma, and inconvenience this brings.

This is when we rely on our insurance cover, but car insurance scams mean that many people are vulnerable without realising it. Knowing what insurance scams to look out for is the first step in making sure you don’t get caught up in an emotional legal dispute.

Staging Accidents

In this scenario, the scammer will signal that they are giving you space to move into traffic and, when you do, they will smash into you. As the scammer originally had right of way,  they will deny having given you the go-ahead, which leaves you liable for the damages. Watch out for staged rear-endings; in this case, the scammer will suddenly stop in front of you, making it difficult for you to avoid crashing into them. They do this knowing that these types of accidents are almost always viewed as the fault of the driver at the back.

There are many other examples where scammers will stage an accident, and the best you can do is to keep alert, maintain your position in your lane, keep a safe following distance, and make sure you always have right of way before proceeding. You can also help to defend your case if you have a dashcam installed and running in your car at all times. High resolution video footage can often work in your favour, highlighting why you took certain actions on the road.

Faking Injuries

Even in the case of minor fender-benders, some scammers will fake an injury from a car accident in an attempt to claim medical expenses from your insurer. Whiplash and random pain are often mentioned as the injury, as these are difficult to view on an x-ray machine or to medically disprove. An immediate red flag is if the other driver only starts mentioning pain or physically reacting to it when the police arrive. You can safeguard yourself from such a scam following the accident by filing a police report, even for a minor accident, and noting the minimal damages; doing so will raise suspicion about medical claims from the other driver.

Exaggerated or Bogus Damages

In what may have been a genuine car accident, sometimes the other party will attempt to increase the cost of their claim by inflicting additional damage to their own vehicle. Although it can be difficult to think clearly immediately following a crash, we’d advise you to snap a good few pictures of the accident scene and both cars – if it is safe to do so – as these pictures can be used to refute a bogus claim.

Fraudulent Agents

Sometimes, car insurance scams take place before an accident ever takes place. Agent fraud is one such example, whereby your premiums go straight into the pockets of a sham agent without your policy ever having been set up. In the worst-case scenario, you will only find out when you need to make a claim, only to learn that you were never covered. It’s up to you to consult only trusted agents and to verify their credentials in any way you can. If you have taken out an insurance policy directly from the insurance provider with contact details found on their corporate website or advertising campaign there’s a good chance you are in the clear. However, if you have taken out your policy from a phone call that you did not request, you may have reason to be concerned. To confirm your policy, contact your insurance provider via contact details on their website and ensure they have your policy details in their system. Also, look out for extra coverage being added to your policy or a decrease in insured value on your car without your knowledge, which can add hundreds of dollars to your premium over the course of a year or significantly reduce the insurance pay out in the event of an accident.

Car insurance is essential, but it’s not enough to simply sign on the dotted line. Every driver should research their chosen insurer meticulously, while remaining vigilant on the road to avoid the worst.

We can help you get the best car insurance for your budget and needs. Contact us today for an insurance quote on your car.