GEICO, a leading auto insurance company, has released a press release to warn their policyholders and drivers about auto insurance scams. The company claims that it’s likely drivers will come across the rising number of scams hitting drivers around the country.
Insurance fraud occurs during the claims process. One person convicted of fraud had over 133 fake insurance policies valued at £90,000.
Staged accidents are one of the most common, according to GEICO. The scam involves multiple vehicles and people involved in the scam. One scam that is on the rise is called the “swoop and squat.” The scam involves two scammers that aim to block the victim into an accident.
One scammer will drive in front of the victim while a second scammer, called a “blocker,” drivers alongside the victim blocking the victim in his or her own lane. The driver in front of the victim will slam on their brakes in an effort to cause an accident. The victim cannot swerve into the opposite lane because a “blocker” is in place.
The incident may involve multiple scammers that come to the scene of the accident and claim injuries. The goal is to increase the cost of the claim to produce a larger insurance settlement.
GEICO’s special investigation unit encourages drivers that have been in an accident similar to the one outlined above to call their insurance company. Victims that suspect they’ve been part of a scam have a few options, according to the press release, to protect themselves from a scam:
- Drivers involved in an accident that are anxious to leave the scene are a red-flag. GEICO recommends calling the police to the scene of the accident.
- Unsolicited tows are a frequent occurrence in scams.
- The number of occupants involved in the accident need to be counted.
Car insurance companies are increasing their special investigation units to help identify auto insurance scams.
Ghost brokers selling car insurance is a growing problem. Britons are facing an increase in insurance scams that target individuals looking for a direct insurance quote. The scammers leverage the rising insurance premiums in the country, offering lower premiums to attract “policyholders.” The fraudster allows victims to open up “policies” that they have no intention of upholding.
Drivers that try to file an insurance claim will find the insurance policy to be a fake.
Auto insurance scams aren’t the only scams on the rise. Insurance scams in South Florida have resulted in seven people being arrested. Miami’s Police Department worked with the Florida Department of Investigative and Forensic Services’ Bureau of Insurance Fraud in a joint effort.
The effort led to raids at two clinics that were suspected of fraudulent billing and paying for patients.
Reports indicate that the clinics hired patients to look like accident victims. The scammers hired individuals to stage or fake accidents. These individuals reportedly received treatment at clinics, which then billed insurance companies for treatments and procedures that were never rendered. Investigators claim the rise in insurance scams have led to a 20% to 25% raise in insurance rates in South Florida.