Canadians can take action on insurance fraud

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Beware of the “swoop and squat”

TORONTO, April 4, 2007 – Canada’s home, car and business insurers are asking Canadians to help in the fight against insurance fraud. Recognize it. Report it. Stop it. The Insurance Bureau of Canada has released information that Canadians need to know about how to protect themselves against different types of insurance fraud and what they can do to help prevent it.

“Insurance fraud is big business,” said Rick Dubin, Vice-President, Investigations, Insurance Bureau of Canada. “It is a low-risk, high-reward crime that costs Canadians about $3 billion per year. However, there are steps that Canadians can take to Recognize it. Report it. Stop it.”

Staged auto collisions are a costly and potentially dangerous type of insurance fraud. They are deliberate collisions that can involve innocent bystanders. A “swoop and squat” is one of the most common types of staged collision. A “swoop” vehicle suddenly speeds up and cuts off a “squat” vehicle, forcing the “squat” vehicle to slam on its brakes. This causes the innocent victim in the vehicle behind to drive into the back of the “squat” vehicle, making them look like the at-fault driver for failing to keep a proper distance. Usually, everyone who is in on the fraud (those in the “squat” vehicle) claims some sort of injury, and makes an accident benefits claim.

To prevent being involved in this type of fraud, IBC advises:

  • Never tailgate; allow plenty of space between your car and the car ahead of you.
  • Look beyond the car in front of you while driving.
  • Be aware of your surroundings and merging traffic into your lane.
  • Your full attention on driving is required – avoid external distractions, cell phones, eating and other electronic devices.

If you are involved in a collision and suspect it may have been a swoop and squat or other type of staged collision:

  • Write down the names of the owner and driver of the other vehicle; vehicle identification number; make, model, and year of the vehicle; and insurance information.
  • Count how many passengers were in the other car when the accident took place. Ask if anyone was hurt. If anyone reports an injury, call the police immediately. Try to obtain the names of all occupants of the other vehicle along with their phone numbers and driver’s license numbers.
  • Note descriptions of the passengers.
  • Take pictures of the other car and the damage it received. It is good to keep a disposable camera in your glove compartment for this purpose.
  • Document the circumstances leading up to and during the collision and keep it in a safe place for further reference. This is a useful tool for refreshing your memory accurately after your traumatic circumstance.

“The most important step Canadians can take is to report the suspicious incident,” added Dubin. “IBC has a dedicated insurance fraud tips line – 1-877-IBC-TIPS (1-877-422-8477). Or anyone can go to www.ibc.ca and send in their tip online using the quick link on the home page.”

About Insurance Bureau of Canada

Insurance Bureau of Canada is the national trade association of the
private property and casualty insurance industry. It represents insurers who
provide more than 90% of the non-government home, car and business
insurance in Canada. For more information, visit www.ibc.ca.