IBC Offers Top 10 Tips to Detect and Avoid Auto Insurance Fraud

They Cheat, You Pay

Toronto, ON (Oct. 2, 2014) – Insurance crime is not victimless. A 2012 report by KPMG estimates that auto insurance fraud costs Ontarians up to $1.6 billion every year. When fraudsters drive up auto insurance costs, you pay more for insurance.

“To help fight auto insurance fraud, IBC has implemented several initiatives to help prevent this costly crime. IBC also educates consumers on how to detect and avoid auto insurance fraud,” explained Ralph Palumbo, Vice-President, Ontario, IBC. “We all must work together to help cut down on this costly crime.”

IBC continues to advocate for legislative changes to help crack down on fraud. That’s why IBC was pleased to see the Ontario government introduce Bill 15, which will amend various statutes to help reduce insurance fraud, regulate tow and storage services, and protect consumers. IBC looks forward to seeing it pass in the legislature this fall.

Types of auto insurance fraud

Tips to detect and avoid auto insurance fraud

1. Be buyer aware.

  • Select a reputable dealer and look into the vehicle’s history.
  • If the deal is too good to be true, it probably is.

2. Inspect the vehicle to make sure it wasn’t in a flood.

  • Check for water stains, mildew, sand and/or silt under the carpets, floor mats and headliner cloth, and behind the dashboard.
  • Look for rust on the screws on the console and in other areas where water doesn’t normally reach.

3. If you think you have witnessed or been a victim of an insurance crime, call IBC’s confidential, 24/7 tip line at 1-877-IBC-TIPS or submit an anonymous tip online.

4. Check IBC’s VIN Verify Service.

  • Ensure that the vehicle hasn’t been re-vinned to hide that it has been branded as non-repairable.

5. Have a certified mechanic inspect the vehicle before buying it.

6. Avoid staged collisions.

  • Never tailgate – instead allow ample time to stop.
  • Look well beyond the front of your car while driving.

7. If you suspect that you were a victim of a staged collision, call the police from the accident scene and use IBC’s tip reporting program.

8. In the event of a collision, document all you can.

  • Write down the other vehicle’s licence plate number, photograph the damage, note the other driver’s behaviour and watch for warning signs of a scam.
  • Fill out the IBC collision report form.

9. Use a reputable tow truck service.

  • Be sure the tow truck has a licensing number.
  • Ask the driver if he or she has a police contract.
  • Carefully read anything you are asked to sign.
  • Ask that your vehicle be towed to a secure location of your choosing.

10. In the event of a collision, call your insurance representative as soon as possible.

  • Understand your policy and know your coverages.

IBC initiatives to help identify and deter fraud

  • Tip line and webpage: An IBC webpage and its toll-free line allow consumers to anonymously report insurance fraud.
  • Provincial Auto Theft Network (PATNET): This award-winning IBC program brings together law enforcement agencies and the insurance industry to reduce auto theft and fraud.
  • VIN Verify Service: This free IBC service allows consumers to check a database containing information from participating IBC member insurance companies to determine whether the vehicle they wish to purchase has been reported as a vehicle seriously damaged in a flood.
  • The Safety Mobile: IBC’s simulator teaches drivers about staged collisions, as well as the dangers of texting and driving.

About Insurance Bureau of Canada

Since 1964, IBC has been working with governments across Canada to make our communities safer, championing issues that directly affect Canadians and the property and casualty (P&C) insurance industry. IBC is the national industry association representing Canada’s private home, car and business insurers.

SOURCE: Insurance Bureau of Canada