Motor Industry News
The 'Credit Crunch' is being blamed for a surge in the number of staged road accidents which put the lives of innocent motorists at risk.
According to figures from the Insurance Fraud Bureau, car crash scams are becoming increasingly common and organised, as criminals seek easy ways to make money during the recession.
In the last few years there have been more than 27,000 known staged car accidents but experts believe the figure is just the tip of the iceberg and is growing.
"Innocent members of the public are increasingly being caught up in staged car accidents in which gangs force victims to crash so they can claim compensation," said Roger Powel, General Manager of mycarcheck.com.
"The problem has been gradually getting worse but in the last few months we've been made aware of a huge increase in suspected incidents. Last year there were at least 3,500 staged car accidents."
According to the Insurance Fraud Bureau (IFB), there are at least 30 organised gangs thought to be behind thousands of fraudulent claims costing more than £200m a year.
Despite the fact that offenders risk substantial jail terms car crime experts claim fraud investigators have never been so busy.
"All too often the people behind these so-called accidents are involved in other illegal activities too such as drugs and gun crime," said Mr Powell.
It's been calculated that insurance fraud costs insurance customers £1.6bn a year, adding £40 to the average price of every policy sold in the UK. That means a family with four policies for household insurance, motor, pets are paying £160 more than necessary to cover the cost of fraud.
"There are three basic types of staged accidents; contrived, staged and induced." said Roger Powell of mycarcheck.com. "A contrived accident is a complete fiction. It will never have taken place. Previously damaged vehicles are used and details of the accident are concocted by the person who caused the 'accident' and the 'victim' working together to get a payout on the 'damaged' cars."
"Often other people are brought in to claim additional money such as £150 for supposedly towing the vehicles away from the 'crash' scene, storage and bogus garage reports etc."
Another variation of the staged accident scam involves criminals selecting a vehicle they know is insured by an innocent victim. Targets could be a person in a fairly new car with a family, somebody in what looks like a company car, or lorries belonging to a big organisation.
"The crooks deliberately cause an accident by perhaps stopping suddenly and getting the victim to run into the back of them. In these cases they all claim personnel injury for whiplash," said Mr Powell.
Often the crooks will try and convince their victim not to contact the police but just to exchange details and save any 'fuss'.
However, Phil Swift, a former policeman turned leading insurance investigator with Claims Management & Adjusting, advises always calling the police. "Stay clam, insist on calling the police and take photographs of the scene and everybody involved - most people have mobile phones with cameras these days."
"If it is a genuine incident most people won't mind but often if there is anything dodgy the crooks will just drive away."