Car Insurance Scams You Need to Be Aware Of
According to the Philippine Insurers and Reinsurers Association, car insurance scams in the Philippines amount to more than a billion pesos a year. Fraudulent individuals and organized groups are responsible for these car insurance scams that include fake car thefts, fake car collisions, and fake vehicle repairs. It’s a growing problem all over the world, with billions of pesos in losses.
Car insurance scams are on the rise. In 2015 alone, an estimated ₱700 million was lost to car insurance claims which were considered fraudulent. The Insurance Commission has already issued an order addressed to all car insurance companies to submit their own anti-fraud strategies and policies in an effort to lower or eradicate the occurrence of car insurance fraud.
You can educate yourself about some of the ploys that these scammers use to milk money from insurance companies. Here are just some of the most common ones.
Intentional accidents, or staged accidents, are one of the most common car insurance scams in the world. Scammers will often trap the victim in a rear end collision, or lure them into making an early turn and collide with an oncoming scammer. Some scammers will also work together in telling drivers that it’s safe to pull out of a parking lot or a side street when it’s not, setting them up for a crash. Scammers can also cause additional damage to their vehicles just to bump up the claim.
You’ve probably seen videos on YouTube where drivers catch scammers in the act of suddenly walking up to their vehicle and making it look like they’ve hit them and caused serious injury. If you don’t have a dash cam installed on your car, you can easily be terrorized into thinking that it’s your fault, and that you should shoulder the hospital and medical costs.
But fraudulent hit and runs are one of the oldest tricks in the book. Scammers can be really good actors. They usually don’t work alone, and they can easily bully you into paying up. To avoid falling for these kinds of scams, drive defensively and install a dash cam in your car. In the event that you figure in an accident, document everything. Take pictures of the vehicles involved, as well as the driver, passengers, and even bystanders who can act as witnesses.
Do not trust people who will suddenly approach you offering to bring you to the nearest car repair shop or mechanic. Most of these car repair shops don’t even sell authentic parts, and they can jack up their prices for no reason. Also decline offers from bystanders suggesting you go see a doctor or a lawyer they know who can help you out. Call your car insurance company who can direct you to the right people.
Scammers will also go to great lengths to earn a quick buck from their comprehensive car insurance provider. They will dump their vehicles in a faraway location and make it look like car thieves left the vehicle there before fleeing. They will even burn it or dump it in the river to make the insurance claim look even more authentic. Then, they will report it to their insurance provider as stolen.
Some car insurance scammers will call you on the phone and offer you the most competitive rates and the most comprehensive insurance packages for your vehicle. Before you get convinced with this agent’s seemingly irresistible offer, make sure that you are talking to an accredited agent of a reputable and financially stable insurance company. Ask for their agent license number and the name of the company they are working for. Verify this information from the official website of the Insurance Commission.
However, even if they are a licensed agent working for a reputable organization, there will still be unscrupulous ones out there who will steal people’s premium payments outright. To avoid being a victim of these people, be vigilant in tracking your insurance payments. Issue postdated checks and don’t give cash payments to your agent. You will know right away if something is amiss, because your car insurance provider will give you a call for a skipped payment.
Always ask for a copy of the insurance policy. Make sure that you read and understand what it contains, and that everything your agent explained to you is included. Double check that there aren’t extras included which you did not approve because these extras can result in a higher insurance premium.
If you figure in an accident, you should wait for instructions from your car insurance provider on which repair shop to go to and who you can contact regarding car repairs. You can go to your trusted car mechanic who has been doing car repairs for you for years, or you can go to other reputable car repair shops in your area. Not all small and unknown car repair shops are shady, though. You just need to weed out the scammers from the real and honest ones.
Do your research on good and affordable car repair services. Ask recommendations from friends and family members. Once you decide on which repair shop to go to, ask for an estimate and get it in writing before the actual repairs are done. This way, you will know that you are not being overcharged.
Check the invoice and the billing statement to see the itemized list and to make sure that only authentic parts were purchased and used for the repairs.
These days, it’s not enough that you have safety features on your vehicle and that your vehicle is covered by comprehensive insurance. These days, you also need to be careful about shameless individuals who’ll use you to execute their deceitful plans.
Always drive safely and defensively. Know your rights as a driver and vehicle owner. Know what number to call and what to do when you get involved in a road accident. This will save you the hassle, the money, and quite possibly even your life.
Here are some tips that can assist you in choosing the best car insurance and help you avoid getting scammed.
Rouselle loves the hustle of writing, reading, and creating content. She currently works with different clients on their web content and social media presence.