Officials Keeping Up Pressure on Auto Insurance Scofflaws

6/18/2010

Auto insurance customers across the country end up paying millions of dollars in unnecessary premium costs due to the wide variety of fraud schemes that are perpetrated by criminals.

This was especially the case during the recession, when cash-strapped consumers could be more easily tempted to break the law by abandoning or destroying vehicles they could no longer afford, and then proceeding to file false claims involving theft or damage.

However, people don't have to intentionally ruin their vehicle to try to game the insurance system. Law enforcement officials in some states have broken up entire criminal rings that stage fake accidents and proceed to file millions of dollars in bogus claims. A more common tactic is for uninsured drivers to try to purchase a policy after they end up having an accident.

In fact, California Insurance Commissioner Steve Poizner recently announced the arrest of two California residents who had tried to buy insurance after an accident. He also pointed out that even people who manage to avoid accidents can be fined and prosecuted if they are found to be driving without insurance.

"Do not compound your problems by committing insurance fraud - you will get caught, and you will be prosecuted," said Poizner.

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