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The term ‘crash for cash’ refers a type of car insurance fraud that is growing in popularity. Branded Business Vehicles are the main target for the ‘Crash for Cash’ scam.
Every year nearly £400 million is stolen from motorists and fleets by ‘Crash-for-cash’ scammers, putting both lives and budgets in jeopardy.
Business vehicles and branded vans are seen as the main target for these staged accidents due to the almost certainty of them being covered by insurance.
‘Crash for cash’ scams have become a particular growing concern over the last decade. More and more motorists have been getting caught out by drivers who deliberately cause a crash in the hope of pulling a fast one on the insurance companies – cashing in on the crash.
Latest figures from the Insurance Fraud Bureau reveal that ‘crash for cash’ scams accounted for £392m last year. An estimated one in seven personal injury claims is linked to this scam.
In the same 2013 report, it was shockingly revealed that 10 per cent of road users would consider taking part in the scam for financial gain. Three in four motorists thought that ‘crash for cash’ scams are a big problem in the UK, supporting the need to better arm road users in the fight against fraud.
What kinds of cash for crash scams are there?
Car Insurance companies have categorised ‘crash for cash’ scammers by three tactics:
1. Induced accidents: These are, by far, the most common, and occur when a scammer deliberately drives dangerously or in a poor manner for the sole purpose of causing an accident. The most common is when a driver in-front intentionally slams the brakes, hoping you career into the back of them. Other examples include when a fraudster knowingly pulls out of a junction or roundabout when it’s safe to do so, giving you no chance of avoiding them.
2. Staged accidents: This is where two willing scammers will crash into one-another in the attempt of imitating a real crash, then claiming on their separate insurance policies
3. Contrived (ghost) accidents: These are accidents that never even happened – falsified insurance claims. Induced accidents are the only incidents which directly affect you, and fortunately, can be combated.
Who is most at risk from a ‘crash for cash’ scam?
There are naturally particular groups of people that are more vulnerable to ‘crash for cash’ scams. Fraudsters will typically try to make you feel like the ‘at fault’ driver, hence why they tend to target the company vehicle looking for a quick settlement. These ‘Accidents’ can cost companies £30,000 or more, which is why businesses need to be more vigilant and work with both drivers and insurers.
How can I combat ‘crash for cash’ scams?
The best approach to adopt is to imagine the presence of your driving instructor, keep a cool-head and don’t let a constant fear of ‘everyone is out to get me’ consume you. Otherwise you’re letting the scammers win.
Remember to be fully alert, keep a safe distance between vehicles in front (adjusting appropriately for weather conditions) and always anticipate any foreseeable hazards ahead and around you.
Essentially, the better, safer and more confident road user you are, the less likely a preying fraudster will make an excuse to target you.
Sometimes though, being armed with just your wits and confidence is not always enough. This is where a RoadHawk black box camera system (also known as a ‘dash cam’) comes to your aid.
Dash-fitted cameras provide irrefutable evidence in the event of a road traffic accident, as the system captures video, audio, GPS and G-force data to battle your case against ‘crash for cash’ fraud.
Some insurance providers offer you a better rate for fitting one of these handy devices. So not only can you get better protection of your insurance premium, but you could also save on your car insurance quotes.
Originally featured in Co-Pilot