Vehicle Insurance Fraud

The Different Types Of Vehicle Insurance Fraud Scams

Cash For Crash

The most common (and dangerous) insurance claim is the staged rear-ending, also called a “crash for cash” or “swoop and squat.” How it works: The scammer will slow down or come to a stop in busy traffic, or at a junction or exit slip road, or they will just swoop in front of the victim, causing the driver to crash into them from behind. In almost every country, rear-endings are considered the fault of the rear driver — in this case, the victim of the scam. The con man may also claim to have neck or back pain, despite the accident’s very low speed. This allows for both a collision and injury claim from the insurer

The Staged Intervention

When an accident has occurred and the victim is standing by the side of the road, waiting for a recovery vehicle and the police to arrive. It’s too late to avoid the accident, but the scam in this scenario comes later. A con artist may approach the driver or even phone them, thanks to a tip from someone and they will then pose as a third-party insurance official or consultant in order to convince you to use the services of a particular company for your injuries, or to use a particular body shop or legal firm. The victim will have likely never heard of any of the services they are offering, and with good reason they’re fraudulent. It’s all part of a setup to get your information so as to file a fraudulent insurance claim, of which they’ll take a hefty cut if not all.

Personal Injury Claim

This can happen in any kind of accident, not just rear-endings.  When an accident occurs the other driver immediately reports back pain, “whiplash” or other injuries. If the driver seeks hospitalization, he’ll file a personal injury insurance claim for compensation. Whiplash and phantom pain are especially hard to display on an X-ray, so fraudsters might cooperate with and pay off non-reputable doctors, chiropractors and physical therapists to corroborate their injury reports, so as to get a large pay-out from insurance companies.

The Different Types Of Vehicle Insurance Fraud Scams 

A short definition of what to look out in the different cash for crash scams to keep your fleet safe

The Phantom Victim

This is when people who weren’t even in the car file a personal injury claim. This scam is known as “the phantom victim. This can be an after-effect of a staged accident or a cash ploy that comes later, the fraudster will attempt to file claims for additional passengers in the car, claiming pain or injury, even if no one else was present.

Flash For Cash

There are more ways other than just a rear-ending for a scam artist to lure an insurance policy into danger. In a situation called “the drive down,” or “flash for cash” what appears to be a friendly stranger who has the “right of way” waves you into traffic and then rams into the side of your car, merging into traffic just as you do. He’ll then deny having given you permission, leaving you liable. A similar scam can occur with two cars vying for a parking space, which ends up with the same result a collision and an insurance claim. One more type of staged accident is the sideswipe, in which the eagle-eyed criminal will intentionally ram your car if you drift into the outer lane of the motor way.