Auto insurance fraud schemes explained

Unfortunately for both insurers and their customers insurance fraud rates are increasing every year, causing a lot of additional costs and pushing up the rates for law-abiding insurance users. It is estimated that every year more than hundred thousand auto insurance claims are investigated as suspicious. Every fraudulent claim filed intentionally and paid by the insurer automatically raises the cost of insurance for all other customers, so in the end it's us who pay for others' scams. And what's more disturbing is that under certain schemes normal drivers also become involved in scams, falling prey to their initial masterminds and forced to pay for things they shouldn't. In order to avoid becoming a victim in such a situation it's important for you to learn about some of the most common schemes and scams used on the road. Of course, they tend to change and evolve with time but the basis mostly remains the same with a set of schemes that are utilized the most:

Swoop and squat

Under this scheme, there are two cars working as a team to target their victim. The first one pulls in front of the victim and the second in front of the first car. When the second car pulls in does so in a way so the first car is seemingly forced to hit the brakes, making the victim's car rear-end the first vehicle. This scheme is often executed at small narrow roads where it's harder for the victim to avoid collision with the first car.

Drive down

This scheme is applied when the victim tries to merge with the traffic from a minor road. The fraudulent driver gives a signal to the victim allowing him to drive but when he does so, the suspect crashes into him, subsequently denying any signal that the victim claims were given by the suspect driver.

Start and stop

The victim's and perpetrator's vehicles are positioned in the same traffic lane, often stuck in a jam or waiting for the traffic light to switch. The suspect's vehicle, which is stationed in front, starts driving and as the victim follows suddenly stops causing a rear-end collision.


This scam is usually applied at busy intersections with double lane left turns. The perpetrator crosses the center line and as the victim enters the same turn sideswipes him, ultimately claiming that the victim entered his lane and caused the collision.

The best way to avoid falling victim to such schemes is driving cautiously and defensively. Always make sure that there's plenty of room to avoid collision or hit the brakes if necessary. Besides, by applying to defensive driving courses you can also opt for a discount from your auto insurance provider.

However, if you ended up in such an accident there are also measures you can take in order to expose the fraud. First of all, make sure to call the police regardless of your fault and insist that a report is made. Note all the information about the other party involved, including the number of passengers, their names, contacts and license number of the driver. Furthermore, write down all the damage caused by the collision as well as the state of the other party's car. Quite often the perpetrators will claim for body injury for people who weren't in the car and state that the victim has caused more severe damage than it was actually at the site.