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| Fraudsters are targeting females and young drivers as they believe they are less likely to challenge an insurance claim. Photo: PHOTOLIBRARY.COM |
Innocent motorists are being caught up in staged accidents and all drivers are being forced to foot the bill
By Nicole Blackmore
Insurance fraudsters have staged over 300,000 car accidents since 2008 in scams that affect more than 1,000 innocent motorists a week and push up premiums for all drivers.
"Crash for cash" fraud takes place when one or more parties deliberately cause a road traffic accident in an attempt to financially gain, often claiming for injuries such as whiplash, with additional pay-outs to compensate for loss of car or lost earnings.
Various methods are used to create an incident which results in the victim believing they were at fault and admitting responsibility.
Research by insurer LV= found over 30,000 people have been a victim of a "slam-on" scam in the past year where the driver in front slammed on their brakes for no apparent reason causing an accident.
LV= said fraudsters target females and young drivers as they believe they are less likely to challenge the insurance claim. Research shows that in the past two years, almost two thirds of victims were female and 59pc were aged 34 or younger.
In addition to staging accidents, LV= has seen a marked increase in fraudsters exaggerating the circumstances of an accident in an attempt to gain a higher payout.
For example, fraudsters may exaggerate or even invent an injury in order to claim compensation, or try to claim for vehicle damage that is unrelated to the accident.
One in three drivers who have been involved in an accident in the past two years say the other party tried to claim compensation for injuries to passengers who weren’t in the vehicle at the time, or say the other party exaggerated the circumstances of the accident in order to inflate their claim.
John O’Roarke, managing director of LV= car insurance, said: "Every year there are tens of thousands of staged accidents, which are putting the safety of innocent motorists at risk. Fraud is not a victim-less crime and the cost of paying fraudulent claims drives up the cost of car insurance for all."
Figures released by the Association of British Insurers (ABI) in July showed £1.1bn of fraudulent insurance claims were lodged in 2012, up £110 m on the year before. The level of fraud was nearly double that recorded in 2007 and was driven by a surge in false whiplash claims. The ABI said fraudulent motor insurance claims totalled £610m, 55 per cent of the total.
Car insurance premiums have started to fall since ministers began a crackdown on fraudulent whiplash claims, however court awards for those injured in car crashes have increased in recent years.
Staged accident tactics
The slam-on
This is where a fraudster brakes sharply for no apparent reason, causing the motorist behind to drive into the back of them. In these cases, the fraudsters will often disconnect their brake lights so the motorist behind does not know that they are slowing down. Over 30,000 accident victims were involved in a staged rear-end shunt in 2013.
The flash for cash scam
This is where the fraudster flashes their headlights at the victim to let them merge into traffic, but will then drive ahead and crash into the back of their vehicle. Some 3pc of motorists involved in a car accident in the past year believe they fell victim to this scam.
The full-car smash
In these cases fraudsters take a car-load of passengers out on the roads and then induce an accident with another vehicle. The fraudsters then make multiple claims for personal injuries, which often far outweigh the cost of repairing the vehicles involved.
In each of these scenarios it usually results in a ‘your word against mine’ situation making it extremely difficult to allocate blame.
Source The Telegraph
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