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Car Insurance Premiums Going Up Due to Fraud

Car insurance is something that most motor vehicle operators have or should have. People pay their car insurance premiums every month and expect that people who also pay their monthly insurance premiums are not gaming the system. Now, AA Insurance has found that more fraudulent car insurance claims are being filed by motor vehicle operators. This has created a huge problem for policy holders and car insurance premiums.

Consumers are suffering due to the fraudulent insurance claims because their monthly car insurance premiums have been increasing. New statistics have found that car insurance claims have increase by over thirty percent. This has made many policy holders. Now, car insurance premiums will continue to increase to offset the costs associated with the fraud. Some have forecasted that in the next year that people could see their car insurance premiums increase by more than fifty percent.

The people who are committing this type of fraud are pretty clever individuals. They often stage car accidents with other people so that the accident seems more believable when it ends up happening. Many car accidents are not well investigated after an insurance claim is filed by a policy holder. Many car insurance companies are inundated with accident claims on a daily basis. This makes it harder for them to distinguish between a legitimate insurance claim filing and a fraudulent one.

The public needs to get actively involved when it comes to preventing car insurance fraud from occurring. Many people get involved in car accidents and do not really think that the person who hit them might be trying to pull a fast one on them.

Many people stage accidents by rear ending someone or lightly side swiping them in an attempt to make it look like they are not at fault for the accident. People who suspect that the car accident that they have been involved with was an attempt to commit fraud should contact their insurance company. Many of the people who commit car insurance fraud have done it at least several times so there should be a distinct paper trail for the car insurance company to follow.

Reducing fraudulent car insurance filings helps to reduce the amount of money that is paid out by insurance companies. If they can even reduce the number of fraudulent filings by at least fifty percent then car insurance premiums should go down.

Another issue that is impacting the price of car insurance premiums is the fact that many people are choosing to not have car insurance on their vehicles. There are millions of people that are currently uninsured right now. These individuals create a huge problem to properly insured drivers. However, because so many people are uninsured, it actually drives up the car insurance premium rates for people that are uninsured. If the costs continue to rise then the people who are uninsured will cause many people to become uninsured because their premium rates will be too expensive.

There needs to be stricter laws enforcing mandatory car insurance coverage for drivers. Most people think that they will not get caught if they are driving around without being insured. However,  in many states police officers now ask a driver for their license, registration, and proof of insurance when they are pulled over. People who cannot provide proof of insurance will get a ticket which can be quite expensive to pay for.

In the future, more needs to be done to make sure that drivers are monitored to make sure that they always have car insurance. There should be a simple automated system wherein if a person’s car insurance lapses, they get a notice in the mail and then begin to face fines for their actions.

Source: Daily Rosetta

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This entry was posted on Tuesday, February 8th, 2011 and is filed under Insurance Articles. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

One Response to “Car Insurance Premiums Going Up Due to Fraud”

  1. Car Insurance

    There are always going to be people that work the system to make money. The best thing others can do is pick a reliable car insurance company that will give a fair price. If rates do rise because of fraud at least you have great insurance that you can feel safe with.

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