Legal Blog
Insurance Scam in Toronto
Tuesday, February 12, 2008
The Toronto Star reported yesterday, Car crashes staged for insurance scam Toronto Police have arrested 14 people related to $650,000 in accident claims. It has been alleged that wrecked vehicles were purchased, repaired and insured for far more than the vehicles were worth and then placed in staged accidents. In total, the Toronto Star reported that 7 accidents were staged.
Among some of the groups arrested and still under investigation are auto-dealers, auto-body shops and tow truck drivers. Some individuals made claims to the insurance company and were never even involved in the accident.
This is very unfortunate and the repercussions of fraudulent activities such as this hurt everyone not just the insurance company. This type of fraud has the potential to really injure people. As it did in March 2003 when an innocent women was killed in a staged accident. It can cause ambulance, fire and police services to become tied up and not attend to serious accidents which is particularly important during these icy, cold and snowy days. Finally, insurance fraud causes the insurance company to become even more vigilant in their investigation of a claim. The Insurance Bureau of Canada reports on its website that over 26% of personal injury claims contain some elements of fraud.
Hopefully, the insurance companies will not let the actions of a few bad apples ruin it for those who are actually involved and injured in motor vehicle accidents.
It is imperative that people are honest with their insurance companies when they first purchase insurance and that they are aware of what they are going to receive. Also, the insured should be forthright at all times in their dealings with the insurer. The last thing you want is to raise eyebrows that prompt unnecessary investigations that will only delay a claim.
For more information on insurance fraud refer to the paper entitled, Insurance Impact Statement-Personal Injury Fraud published by The Insurance Bureau of Canada. The Insurance Bureau of Canada has a very strong and effective lobby. An increase of insurance fraud schemes such as the one mentioned above have the potential to hurt all especially you!