5 common car insurance scams and how to avoid them

People can be so talented and excessively witty at times. However, organized crime groups utilize these skills to take advantage of people that are vulnerable and unsuspecting of their elaborate schemes and tactics.

Lately, news of car insurance scammers is surfacing, as victims come out and expose their modus operandi. Scammers claimed insurance from bogus bodily harm and damaged auto parts that were initially deemed as the other person’s (victim) fault.

Auto insurance scams rob car owners as much as they do the insurance companies, by way of higher premiums, apart from tarnishing the victims’  driving record. This scam is considered as a financial crime like tax evasion cases are.

It is important, therefore, for any car owner to steer clear and ensure not to fall victim to this kind of scheme; arming yourself with the knowledge is the first step. To help you be knowledgeable of these scammers’ tactics, Philkotse.com has prepared a short list on how to spot a car insurance scam and the ways to avoid being a victim.

1. The staged rear-ending crash

It is otherwise known as “crash for cash” or “swoop and squat." It happens when a scammer (driver) hit on busy traffic, either by slowing down or coming to a screeching halt, that’ll eventually lead to you (victim) hitting the car in a rear-end accident. In most cases, rear-end collisions are deemed to be the fault of the driver from behind the damaged (bumped) car.

Aside from cashing in from the repairs for the car, the scammer can even gain additional money by claiming medical expenses and fees.

To avoid this situation, always keep your car's distance from other vehicle's at a considerable gap. Never tail another person’s vehicle. This will leave you a little wiggle area in cases of collision and other incidents. At the same time, be aware of the traffic in front of you. If you still can't decide which insurance brand to get, check out our article on the 7 the best car insurance Philippines.

Aside from cashing in from the repairs for the car, the scammer can even gain additional money by claiming for medical expenses and fees

2. The not-so-good Samaritan

If you’ve been tragically involved in a car accident (which you cannot run away from), there are possibilities that you’ll have to wait for authorities and a tow truck service to arrive. In this scenario, a Samaritan will either come up to you or call you and will introduce himself as a third-party insurance agent.

He will lure you in connecting with this particular clinic for the injuries you sustain, or advice what car service repair shop to go. Later on, you’ll only discover that an insurance claim was made under your name without you applying for it and making a hefty payday in an instant. The con man was a set-up to obtain your details pertinent to the accident.

Make sure that you transact specific businesses with the right people such as the insurance agent you signed the policy with and not with other people you are not familiar with. At the same time, avoid handing out your personal details to people you don’t trust.

Avoid handing out your personal details to people you don’t trust

>>> You might like to check out: 10 must-know things to consider before buying car insurance in the Philippines

3. The actor

This may not only happen in rear-end accidents but to other cases as well such as fender-bender and minor collisions. Say you got into an accident despite keeping your speed at the minimum and you’re not gravely harmed.

The actor will demand hospitalization coverage and medical expenses to be shouldered by your insurance. More often than not, these actors collaborate with bogus doctors and other medical practitioners to provide documentary pieces of evidence of the injury.

If you notice that the actor seem well and okay after the incident happened and only seem to feel the pain when the police arrive, be wary. File a police report for this case to assess if the damage is at a minimum.

The insurance company will then evaluate that since there are minor damages to both property and drivers, there’s a little to none chances that the actor and his supporting ones will obtain a paycheck for a lousy performance.

The actor will demand hospitalization coverage and medical expenses to be shouldered by your insurance

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4. The "hood jumper"

No, it is not a game. In fact, it’s a deadly scam because if you witness some dashboard footages of insurance claimers (that were explicitly denied), some people dare to throw themselves into a running vehicle and even ask for financial compensation for the injuries that person sustained.

One way of avoiding such a tragedy is to install a dashcam for your car. This does not only prove to be effective in guarding yourself against insurance scammers but act as a surveillance tool as well in cases of traffic violations and similar activities.

Take note that some (not all) persons of authority take advantage of their power to ask money from motorists because they make it seem like the driver is at fault for something. The footage will be compelling evidence if you are filing a complaint in the police later on. 

Some people dare to throw themselves into a running vehicle and even ask for financial compensation for the injuries that person sustained

5. The grand scheme

The actor is just a teaser for what’s coming. The grand scheme is the ultimate plot for ensuring hefty amounts of a paycheck for the scammer and his associates.

The “drive down” for example, is a driver who is at the right of way, waves you into the upcoming traffic, and then ultimately rams the side of your car to merge your vehicle with the traffic. After an investigation, he will deny the fact that he gave you permission to do so, making it seem that the incident was your fault.

The grand scheme is the ultimate plot for ensuring hefty amounts of a paycheck for the scammer and his associates

The most effective way to avoid being involved with such scams is always to follow traffic rules, the right of way procedures and being alert and vigilant with your surroundings.

In this world, many people will think of ways to obtain money despite having such unjust means. These are people that are full of tricks, lies, and deceptions. For them, the easiest way to have money is not to work for it but to steal from other people. If you think you are being scammed, don’t hesitate to report the incident to the police and work with your insurance provider.   

>>> Click here to get more helpful tips and advice for your safe driving