Safety Information Center
Stopping Insurance Fraud

Stopping Insurance Fraud
The hidden "tax" on your auto insurance rates

Stopping Insurance Fraud adds up to more than $30 billion annually. Through increased insurance rates, higher law enforcement costs and inflated prices for goods and services, ultimately you foot the bill. There are many misconceptions about insurance fraud, but none more prevalent than the one that it somehow only impacts the insurance company and not the customer. Here are some of the many insurance scams that effectively impose a hidden "fraud tax" on your rates.

If you suspect insurance fraud report it immediately to the National Insurance Crime Bureau at (800) 835-6422 or to our toll free fraud hotline at (866) FRAUD UC or (866) 372-8382. You can also report insurance fraud via e-mail at

Swoop & Squat

The fraudulent driver stops abruptly, causing the vehicle behind it to rear-end it.

Drive Down

A driver waves on another driver, clearing the way to go, then intentionally hits the passing car.

Hit & Run

Using an already damaged vehicle, the criminal claims they were in an accident and can’t identify the other car.

Paper Accidents

A car owner fabricates an accident by filing a false police and insurance report.

Policy Cheating

Using a friend or relative’s address to register a car and misrepresenting how far the car
is driven for work to obtain a lower premium.

Medical Fraud

Unethical doctors and medical mills scheme with patients to create fictitious accident-related injuries. They collect on multiple office visits and tests which were unnecessary or never took place. They often work through middlemen or "runners" who recruit patients for their scams.

Risky Repairs

An auto body shop offers to "hide" the deductible by padding the repair bill or inflating
the claimed damages.

Three ways to prevent insurance fraud and help keep your rates down…

1. Familiarize yourself with the scams listed here and recognize the signs of insurance fraud when committed by others.

2. Criminally fraudulent acts can be committed by anyone. They can range from
organized crime rings, to white-collar professionals and your next door neighbor. So, be cautious and aware.

3. The short term "benefit" of committing insurance fraud is far outweighed by the potential loss of coverage when it’s needed most, and the fines and imprisonment when caught. Don’t let friends or relatives make foolish mistakes they’ll regret later.

Our Commitment to You

We have an aggressive anti-fraud program. In early 1999 we created a special team to protect your rates from this "fraud tax." We want to ensure that our responsible
customers are not paying to subsidize drivers who may have used deceptive means to obtain insurance and those who misrepresent themselves or their driving records.

We investigate thousands of cases of deception that impact customer rates. By doing so, we can help keep the rates of honest, responsible drivers as low as possible.

We are a proud member of the National Insurance Crime Bureau.

Safety Information Center
This article was prepared by Direct Response Corporation, on December 6, 2006 as a service to you.