Fact – Reducing Auto Insurance Fraud Would Reduce Auto Insurance Rates

It is a common believe that auto insurance fraud is not a concern for the customers and automobile insurance clients. You are wrong. You are paying higher automobile insurance premiums because of the auto insurance fraud. One is always looking for low auto insurance rate from the insurance companies, without having a peek as to the problems faced by the auto insurance companies.

As per the insurance industry the cost of insurance fraud claims is $30 billion annually which includes all frauds for property and casualty insurance business. The auto insurance frauds form the majority chunk of the losses which accumulate because of the auto insurance fraud. The insurance companies’ base their insurance premium on the expenses incurred and claims is a major part of the expense. Hence the burden of this fraud is passed on ultimately to the customer. The automobile insurance premium is hiked each year and as a customer you will have to shop for low auto insurance premium.

Recently, a Virginia woman Teresa R. Gallop was sentenced in federal court Monday on 5th October 2009. The 41-year-old had 60 prior felony convictions; including one for manslaughter .Gallop was convicted earlier this year of staging three car crashes, using children as young as 4 pretending to be victims. Gallop collected about $50,000 in insurance payments.

Automobile insurance fraud are cleverly crafted and a game played by unethical group of professionals like the doctor, lawyer and the claimant trying to create a situation, wherein the injury is exaggerated for making money. The intent of the fraud is not about getting the auto repaired but it has been found that more frauds involve pretended injuries or disabilities. These accidents are cleverly staged at places which are not crowded and the targets are usually new and expensive car drivers. All of a sudden the vehicle in front of you would pull to a halt and you get trapped in a rear end collision. There are countless ways of staging fraud accidents and it always takes sometime before each case can be interrelated and the person staging the fraud is caught. Each of us needs to be aware to save yourself and also national wealth.

As a customer and prudent person you need to avoid becoming a victim of any fraud or be drawn into any action on the part of others for creating situations and ploys of staging accidents for making quick cash from insurance. This are created accidents for own benefit. Here are some ways you can avoid frauds from occurring:

– When you are driving the car always drive defensively. There are some drivers who want to intentionally create an accident so as to claim car repairs or personal injury.

– If by chance you get into an accident make sure that you have the names of all the occupants in the car and details of the driver. It would also be advisable to collect the names of witness around the sconce.

– Be sure to report any accident to your insurance company and also the police so that investigation and follow up is done immediately. This would reduce the chances of fraud since everyone wants to avoid problems with authority.

– In case you suspect a fraud, you can report it to the insurance company or agent so that they can take action if required. You can also send them an e-mail or report it to the customer care department of the insurance regulators.

– Be aware of all the various ways in which car insurance fraud can occur. Insurance blogs, insurance magazines and insurance education institutes are good sources for information.

Fraud management is now a subject taught to the insurance professionals to curtail the frauds. It is common knowledge that in any field fraud makes everyone pay dearly. Take the steps illustrated for getting rid of the high unnecessary insurance costs to get low auto insurance rates and pay a low automobile premium all the time. Ensure that auto insurance frauds are curtailed and you will get low auto insurance rates.

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