Reporting Car Insurance Fraud (Part 2)

We continue our post on reporting car insurance fraud with fraud from your agent, insurance company and how you can report fraud.

People that can report car insurance fraud are very important in saving you and I on our insurance premiums.

In “Reporting Car Insurance Fraud (Part 1)” we talked mainly about fraud on the claims side of insurance. How claims fraud can be a simple false claim being filed to an elaborate scheme. In this post we will cover fraud that is from the people you are supposed to be able to trust: your insurance agents and insurance company.

Car Insurance Fraud from your Agent

Agents are supposed to be there as trusted insurance advisors, but this doesn’t always happen. Sometimes they are just there for the take. They set up insurance agencies and for the first part of their careers they may be running a completely legitimate business. It’s when they decide to start keeping your insurance premiums for themselves that a good agent goes bad.

So while you are religiously paying your insurance premium month after month or term after term, your insurance policy has actually been cancelled for no payment. But, you should have received the cancellation notice right?

Nope, because your insurance agent updated your address with the insurance company so that all of your paperwork (including that cancellation notice) comes to them. You are without insurance and your agent is a little bit richer.

Car Insurance Fraud from your Insurance Company

Even insurance companies can be involved in a car insurance scam. The larger companies try to keep themselves legal, but you never know when a rouge employee is doing something illegal that hasn’t been caught yet.

Also insurance companies that you have never heard who are selling insurance online, have a good chance of being fraudulent companies. Here are some things to look for before you give that unknown insurance company any money:

• Look for an out-of-country address or no physical address provided on the website.

• Check with the Insurance Commissioner or Department of Insurance in your state to make sure that this company can legally write insurance in your state.

• Check with the Better Business Bureau for any complaints.

• If the insurance premium is too good to be true, it probably is.

• The absence of a customer service phone number to call or any contact information for a claims department.

As a consumer, anything that doesn’t seem right about your insurance company or potential insurance company needs to be reported. Better to report and be wrong, instead of being right and being a victim of car insurance fraud.

Car Insurance Fraud Costs you Money

The more money that is paid out each year in car insurance fraud is bad news for everyone, especially for you as an insurance consumer. The amount of fraud money that is paid out is one of the factors that increase your insurance premium every year.

Is that fair? No, but insurance companies are in the game to make money not be charitable. In order for them to make money they have to recoup their losses by bring in more income. This income comes in the form of your insurance premium.

Where to Report Car Insurance Fraud

There are a number of avenues that you can take to report car insurance fraud. What way you choose will depend on the type of fraud that you are in need of reporting.

Car insurance fraud can be reported directly to the insurance company in the case of a claim or a fraudulent agent. The insurance company is going to be more than willing to act on the report of fraud as they aren’t going to want to lose money to a fraudulent claim. They also are not going to want to be associated to an agent that is supposed to be representing them and is instead stealing money from their clients.

Any type of fraud can be reported to your state Insurance Commissioner or Department of Insurance and also to your local authorities. If the local authorities can’t help, they will direct you to who possibly can take action.

The Coalition Against Insurance Fraud also has additional information on how to report car insurance fraud or any type of insurance fraud for that matter. Their website is a great resource to use for more information on reporting car insurance fraud and ways that you can even report fraud anonymously.