Crash for Cash - Don’t become a victim

Fraud causes enormous harm to our economy and society in general, it is arguably second only to Class A drug trafficking.

What is alarming is the sharp increase in reported fraud – and the significant implications this has for the insurance industry. According to the ABI, up to 2,000 bogus incidents are reported each week.

The current economic climate is no doubt a factor behind the sudden increase in fraudulent claims and the insurance industry is responding by preparing a major crackdown on what has become known as ‘crash for cash’ incidents.

The Insurance Fraud Bureau has expressed concern that these incidents (where drivers deliberately cause a crash to enable them to profit from bogus insurance claims) are growing in such numbers that ‘crash for cash’ is now a national problem.

In a typical 'crash for cash' incident, the fraudulent driver will brake suddenly when coming off a motorway junction or entering onto a roundabout, causing the vehicle behind to strike them in the rear. Often the vehicles being used in such incidents have the brake lights disabled so that the following driver has no warning to slow down.

These staged incidents can be very difficult to detect and often things only come to light when the fraudulent details do not tie up with the innocent claimant’s version of events.

Fraudsters will make claims for damage to their cars, exhorbitant replacement vehicle hire charges and for personal injuries they don't have. In some cases they are acting on behalf of someone who wasn’t even present at the accident. More often than not they will be claiming for the maximum number of passengers their vehicle can hold even if they were the only person in it at the time. In some organised crash for cash rings, people will act as 'phantom witnesses' saying they were at the scene of the accident when they weren't.

Bogus injury claims tend to be for things like whiplash where there is no visual evidence to disprove the complaint and which are therefore easy to fake.

How we are combating these bogus claims

Insurers will consider key fraud indicators at the first notification of the claim and throughout the life of the claim.

Indicators include:

1. Questionable circumstances
2. Damage inconsistence with the circumstances
3. Personal injury claims for minor collisions
4. Lack of evidence
5. Personal circumstances
6. Claims/loss history
7. Suspicions in regard to the third party/passengers and their representatives
8. Suspicions in relation to any witness
9. If you can get a view inside the rear boot of the vehicle look to see if there are a number of tyres lying loose inside. A typical indication of fraudsters protecting themselves from injury.

Policyholders can assist with the identification of potential fraudulent claims by:

1. Insisting on full contact details for the third party including land line telephone number and insurance details.
2. Obtaining vehicle make/model/registration number.
3. Accurate recording of damage sustained in the accident and any pre-existing damage.
4. Obtaining names of passengers in the vehicle, and where they were sitting when the incident happened. Note any injuries sustained if any.
5. Provide the insurer with details of any suspicious circumstances, for instance sudden braking for no apparent reason. Was the car parked illegally or on a bend?
6. If possible, (maybe camera on mobile phone) obtain a photograph of the vehicle damage and record the position of both vehicles immediately following the collision and any debris on the road. Check the registration plate front and rear.
7. Observe the driver and passengers’ behaviour, are they over friendly/aggressive/impatient?
8. If you have any doubts about the incident, report it to the police.

Drivers of commercial vehicles (especially those that display company names and logos) are specifically targeted by fraudsters primarily because they are likely to be insured through a reputable company.

Liveried articulated vehicles are often targeted by a driver who will wait at the side of the road and then pull out into the path of the target vehicle before abruptly applying the brakes.

Often a second vehicle is used to cut across the other vehicle. This gives the impression to the innocent driver that the vehicle in front had a reason to jam on its brakes and therefore reduces suspicion.

Policyholders should ensure they have a mobile camera phone to photograph the third party driver as this quickly helps to ascertain if the person is acting on behalf of someone else. Most importantly, all insured drivers should be aware at all times that there is a strong likelihood that they may be targeted. Anyone involved in an incident where there are suspicious circumstances, should contact their insurer as soon as possible.