Organized scam rings are already costing the industry millions and are placing innocent people in harm’s way.
According to investigators, auto insurance fraud is becoming more frequent as well as more sophisticated, as they are now involving organized groups as opposed to individuals or a small handful of people.
Today’s insurance scams involve faked crashes with involvement of medical clinics and other professionals.
This allows the collisions to occur, the claims to be made, and phony treatments to be administered in order to generate lucrative payouts for those involved. The success of these auto insurance scams has caused them to become increasingly popular. That said, it has also caused the various types of crimes associated with these activities to expand into other areas.
The practice of faking auto insurance claims has gone far beyond a staged accident and into other crimes.
According to the vice president of investigative services at the Insurance Bureau of Canada, Rick Dubin, “We’ve seen a definite increase in identity theft within the medical clinics with regard to claiming accident benefits.” There is a group of fifty investigators under Dubin’s leadership. Their primary purpose is to look into organized crimes against private auto insurers across the country. On any given day, there are dozens of alleged staged accidents that are being investigated by these people.
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Nowadays, the faked crash is only the start of the issue, and acts as a “catalyst” for a much broader scam that reaches out into other industries. The phony victim often seeks out treatments in medical clinics and rehab centers where there are employees and professionals who are in on the fraud. According to Dubin, “This is where the real money is.”
He also pointed out that it is in this area where auto insurance companies have found their payouts becoming considerably higher. Unfortunately, this has raised the costs of those insurers and the expense is being “passed on to the innocent customer.” Employees or owners of the medical clinics and rehab facilities are sometimes caught up in these scams, forging the signatures of real chiropractors or doctors – who have no knowledge that this has happened – in order to be able to collect on the “treatments” for soft tissue and whiplash claims from collisions that were staged.