In this blog, we will learn about the top car scams fraudsters are pulling in 2023 and the key strategies to protect yourself from being scammed.
2023's Top Car Insurance Scams and how to avoid them with a dash cam
Auto insurance scams are unfortunately all too common and contribute to high insurance premiums for drivers in states like Florida and New York. The problem is so widespread that it is estimated to cost the insurance industry around $40 billion annually, with the average U.S. family paying an extra $700 yearly in increased insurance rates and premiums.
Fraudsters are always adapting and coming up with new ways to scam drivers, so it's important to stay informed about the latest trends. Here are some of 2023's most common car insurance scams and how to avoid them by installing a dashcam in your car.
Scam #1: Staged accidents
How the scam works: In this scam, the fraudster intentionally causes an accident to make false claims for injuries or damages. These staged accidents can include hard braking (or panic stops) and wave-and-hit. According to the National Insurance Crime Bureau, staged accidents occur more often in urban areas. They tend to target wealthier communities, as well as newer, rental, and commercial vehicles, where there is an assumption of better insurance.
How to stay safe: The best way to protect yourself against staged car accidents is with a dash cam. A Full HD or higher resolution dash cam with a wide field of view can effectively capture clear dash cam footage. Multiple cameras provide more comprehensive coverage, so a dual-channel system is better than a single-front-facing camera. To ensure complete coverage, consider a 3-channel system like the VIOFO T130, which includes an interior camera that can swivel to capture incidents and interactions on the driver's side. So, even if the other driver approached you or the driver’s side window with threatening statements, the VIOFO T130 will have you covered.
Scam #2: Jump-in passenger
How the scam works: In this scam, an unscrupulous passenger jumps into the car of the other driver involved in an accident and claims injury, even though they were not in the car at the time of the accident.
How to stay safe: With no police or witnesses, it’s your word against theirs. The best thing to do is collect accurate information at the scene of an accident. Take pictures with your phone. If possible, get the names and contact information of everyone involved, including any witnesses at the accident scene. You can also call the police and ask them to file a report - and you can file a claim with the police report and file number. You can also scan the area for security cameras that may have recorded the scene of the accident from other angles.
Scam #3: Bandit tow truck
How the scam works: Unsolicited tow truck drivers wait to take advantage of drivers who have been involved in an accident. They offer to tow the vehicle and then charge an exorbitant fee. Shaken up from the accident, you authorize the tow to a repair shop recommended by the tow truck driver. The repair shop pays the tow truck driver a fee for bringing your vehicle to their shop. The repair shop will then overcharge for repairs and make up required repairs, costing you and your insurer more money.
How to stay safe: If you have the VIOFO T130, you should also point your dash cam camera towards the tow truck driver, so you also get video documentation of any conversation exchanged. And don’t turn off your dash cam just because your vehicle is safe on the back of the tow truck - keep it rolling in case anything happens to your car while you’re away - you also have a video of it.
Scam #4: Exaggerated injuries and damage
How the scam works: This scam involves falsely inflating the number of damages to a car after an accident to receive a higher settlement from the insurance company. Fraudsters often will claim an injury that is difficult to notice, such as whiplash or other internal injuries.
How to stay safe: Unfortunately, protecting yourself against exaggerated injuries is almost impossible. But you can still collect accurate information at the scene of an accident and take pictures with your phone. If you suspect the other party is injured, it’s always better to call the police for emergency medical assistance.
Scam #5: Fraudulent car repairs
How the scam works: This scam involves repair shops overcharging for unnecessary or fake repairs or using used or counterfeit parts instead of new ones. Unethical mechanics prey on those who don’t know their way around under the hood of a car. Exaggerating repair costs occurs in many instances, such as repairing with used parts but billing the insurance company for new parts or simply billing the insurance company for work that was never performed. The airbag repair scam is a classic car repair insurance scam.
How to stay safe: The best way to avoid this scam is to pick a trustworthy repair facility, ask for references, and get your car inspected when you pick it up after repairs.
Are there any group of drivers that are targeted more often for car insurance scams?
Car insurance scams can target anyone, but certain groups may be more vulnerable due to their lack of knowledge or experience with the insurance system. Some groups that may be targeted more often include:
1. Elderly individuals: Older individuals may be more likely to fall for scams because they may not be as familiar with modern technology or may be more trusting of individuals who appear to be knowledgeable or professional.
2. Immigrants: Immigrants may be more likely to be targeted because they may not be familiar with the insurance system in their new country or may be more likely to trust individuals who appear to be from their own community.
3. New drivers: New drivers may not have a lot of experience with the insurance system and may not know how to recognize a scam.
It's important to remember that anyone can fall victim to a car insurance scam, regardless of age, income, or level of experience. The best way to avoid a car insurance scam is to be informed and to take steps to protect yourself.
How do you report car insurance fraud?
If you suspect you have been a victim of car insurance fraud, it's important to report it to the proper authorities. Here's how to do so:
Contact your insurance company: If you suspect that you have been a victim of insurance fraud, the first step is to contact your insurance company. Your insurance company will be able to provide you with guidance on how to report the fraud and what steps to take next.
- Report the fraud to the National Insurance Crime Bureau (NICB). The NICB is a nonprofit organization that helps to detect and prevent insurance fraud. You can report car insurance fraud to the NICB by calling their hotline at 1-800-TEL-NICB (1-800-835-6422) or by visiting their website at www.nicb.org.
3. Report the fraud to your state's insurance department. Each state has an insurance department that is responsible for regulating insurance companies and investigating insurance fraud. You can find the contact information for your state's insurance department by visiting the National Association of Insurance Commissioners (NAIC) website at www.naic.org.
It's important to report car insurance fraud to the proper authorities to help protect yourself and others from becoming victims. By reporting the fraud, you can help bring the individuals or organizations responsible to justice and prevent others from falling victim to similar scams.
Can a dash cam help fight car insurance fraud?
Yes, it can!
Using a dash cam can help protect you against these scams by providing objective evidence of what happened during an accident. The dash cam footage captured can help refute false claims and provide solid video evidence to support your case. Dash cameras record the view from a vehicle's front, rear, or interior and can help establish facts such as the speed of the vehicles involved, the actions of the drivers, and the road and weather conditions at the time of the accident. These measures can help prevent you from becoming a victim of car insurance fraud.
Do you have to tell your insurance you have a dash cam?
While you are not required to inform your insurance company about a dash cam, it's a good idea to check with them to see if they have any specific requirements or if the footage could be useful in resolving a claim.
If you do choose to use a dash cam and are involved in an accident, you may find that having the footage is useful in resolving the claim and determining who was at fault. In this case, you may want to share the footage with your insurance company voluntarily.
Equip your vehicle and outsmart car insurance fraud with these dash cams
Worried about insurance scams? Here are our top 3 dash cam recommendations:
✅ Triple-channel coverage
✅ 2K QHD + 1080p Full HD + 1080p Full HD
✅ Rotatable interior camera can be adjusted to point at the driver’s door
✅ 140° wide-angle lens
✅ Parking mode recording
BlackVue DR900X Plus
✅ 4K UHD @30FPS front camera
✅ Full HD rear camera
✅ 162° Ultra-Wide Field of View
✅ Configurable motion & impact detection
✅ External LTE module for always-on Cloud connectivity
✅ 4K UHD @30FPS front camera
✅ 2K QHD rear camera
✅ 150° wide viewing angle
✅ Advanced Wide Dynamic Range, Intelligent Automatic Exposure and Super Night Vision 2.0
✅ Extended parking surveillance coverage
✅ Smart road cameras and driver safety alerts, Cloud-ready
Drive confidently, and don't let scammers get away with billions of dollars yearly in fraudulent claims.
And you never know - your insurance company might offer discounts and save you money if you have a dash cam installed in your car.
We hope our post has given you a better look at some car insurance scams. A dash cam doesn’t just come in handy for recording road rage or accidents but also situations and insurance scams that fraudsters are trying to pull.