Protecting Yourself From Insurance Fraud

When the economy goes sour, consumers have to be on guard against fraud of all types, including insurance fraud. And insurance fraud can come from both directions, either instigated by fake or fraudulent insurance companies or perpetrated against you by other drivers looking to settle a claim against your legitimate insurance carrier.

Be careful when driving. Other drivers may attempt to force you into situations where you become the at fault driver in an accident. This type of fraud may include property damage claims or fraudulent claims for injuries. The concept of this type of fraud is to use one or more vehicle to force you into having an accident, such as one car forcing into your lane so that you collide with a second one. The first vehicle then leaves the scene of the accident, and you are responsible for hitting another car. The best defense against this type of insurance fraud is to always be aware of the other vehicle on the road, and on the lookout for unusual or erratic driving patterns.

Insurance company fraud occurs when you purchase a policy from a company that is legally capable of backing the policy. This type of fraud is especially common in predominantly older communities, and may involve auto, home, life or health insurance. The insurance agent who sold the policy may not represent a real insurance company, or he may be part of a company that is no longer licensed to sell coverage or financially able to pay a settlement. Your best defense against this type of insurance fraud is to always check with your state’s department of insurance before signing a policy. Remember, insurance policies are legal contracts, and it is your responsibility to know what you are getting into before you sign the contract.

If you suspect a problem with your current insurance company, use online insurance quotes to find yourself a more dependable carrier. You can tailor the policy to fit your needs, and compare the costs between more than one insurance provider. Be sure to check with your department of insurance to make sure the company is licensed for your state and check with a company such as A.M. Best to make sure the insurer is financially able to pay a settlement if you have to file a claim.

Posted in Car Insurance.