Making a claim on your car insurance is never an ideal situation. However, it becomes even worse when the claim was a result of scam – or if scammers trying to use your claim to get money out of you. Like any scams, it’s not always easy to tell when you’re being conned, so it’s important to make sure you’re clued up to avoid falling victim to a scam.
Common claim scams
- Crash for cash
- Fake injury
- Fraudulent calls
- Fronting
‘Crash for cash’ scams
‘Crash for cash’ scams (otherwise known as ‘contrived accidents’) are one of the most well-known types of scams, so the chances are you’ll have heard of them already. In these scams, a driver will deliberately cause an accident by distracting you or stopping ahead of you suddenly.
A common scenario will see the scammer’s car brake heavily on a roundabout for no reason. The aim is to get you to drive into the back of them while you’re focused on watching other traffic on the roundabout. The scammer can then make a claim on their insurance, and they may also try to claim for personal injury or for other compensation.
This type of scam can have adverse consequences for the innocent third-party as, if you’re found to be at fault, you could lose your No Claims Bonus and have to pay an excess – as well as being left with damage to your car or even to yourself.
There are a few steps you can take to avoid being involved in a ‘crash for cash’ accident, as provided by the Insurance Fraud Enforcement Department (IFED). These include leaving enough space between you and the car in front so you have time to react if they stop suddenly, looking out for cars with broken brake lights (fraudsters may stop these from working so you have no warning they’re braking), and keeping your distance from cars that are generally driving erratically, including cutting into your lane or pulling out from a junction in front of you.
‘Fake injury’ scams
If you’ve had a car accident, there’s always the risk of injury. That’s why most insurers offer personal accident cover as an optional extra – to cover you in case you do get injured. However, in some cases, a driver involved in an accident might claim to be injured even when they’re not, or exaggerate a claim they do have with the aim of getting compensation from the insurance companies.
They may even claim to have had a passenger in the car who is injured, even when there was nobody else in the car. As whiplash and some other injuries are hard to detect, it can be tricky to prove when a claimant is lying about such an injury. Plus, having to pay compensation to them can boost the cost of your claim.
In the event that a personal accident claim is made, your insurer will investigate further. In some cases, this may weed out any potential con artists. However, you can also help by recording details of the crash – such as if any passengers were involved or how significant the collision was – that you can provide to your insurer to aid any investigation. If the other driver seems fine at the scene but suddenly gets an injury if the police arrive, this might be a sign that they’re trying it on.
Calls about your claim that aren’t from your insurer
Once you’ve reported a claim to your insurer, they’ll deal with it for you. You shouldn’t have any need to discuss it with anybody else, unless the police have been involved with a claim and contact you as part of their investigation.
We’ve all had the call telling us we’ve “been involved in an accident that wasn’t our fault” even when we’ve not been in an accident. So, if you receive this, or any other call around your insurance that isn’t directly from your insurer, the likelihood is it’s a scam.
They may be claiming to be a lawyer, mechanic, or a health professional in relation to your claim. The person might sound like they really want to help you, but you should never give them your personal details, as you may become the victim of fraud.
Fronting
This isn’t a scam where you need to be on the lookout for con artists – it’s one that you may be committing yourself. ‘Fronting’ is a term used to describe a situation where a more experienced driver (such as a parent) takes out a policy on a car in their name, despite not being the main user of the insured car.
Instead, they add the main car user (which may be their child who has just passed their test) as a named driver. In reality, this named driver will actually be using the car more frequently than the policyholder. The main reason for this is usually to save money by having the policy in the name of a more experienced and less at-risk driver – but many people don’t realise this is actually illegal.
Doing this could make your insurance invalid in the case of a claim if the named driver is the one involved. This means your insurer won’t cover the costs and, if you’ve already had an accident you need to claim for, it’s not an ideal time to find out you’re not covered.
Being subject to a scam can be a scary idea, especially when it puts you and your car in danger. It may not always be possible to avoid a scam, but being aware of the dangers may help you to keep away from the fraudsters and stay safe.
Correct at the time of publication. Information in this article has been gathered from various sources, therefore WiseDriving cannot be held responsible for any view or opinion expressed herein.
