The insurance industry is a frequent target for fraudulent activities because of the lump sum amount of cash people collect each year. Auto insurance fraud, for example, is estimated to cost many car owners between $400 and $600 in premium costs each year.
Unfortunately, even if you aren’t directly involved in auto insurance fraud, it can significantly increase your premium and drag out legitimate insurance claims. It’s essential to avoid auto insurance cases at all costs and report to your insurance provider in case of any fraudulent suspicions.
You should also learn to protect yourself from car insurance fraud to ensure you get low premiums and affordable insurance. Here are some types of auto insurance you should avoid.
1. Staged accidents
When you deliberately stage a car accident, theft, or injury to collect some money, it’s considered insurance fraud. However, at times you may find yourself in the middle of a staged accident without your knowledge.
For example, two vehicles trap you in a rear-end collision, or another car hits yours deliberately. In such cases, always take pictures and get the contact details of the persons involved in the accident.
2. Fake and exaggerated claims
Due to the rising number of insurance companies in the market, there are a lot of fraudulent insurance agents that want to collect from unsuspecting clients. Such agencies collect premiums for insurance policies that don’t exist.
Always go for a licensed and experienced insurance company to avoid such fraudulent claims and confirm whether the agents work for the said company.
3. Accident repair fraud
When your vehicle is involved in an accident, it will require repair to reinstate it to its original condition. Some mechanics take advantage of this by charging more than is needed to fix the damages in your car.
Ensure you ask your provider for a reliable repair shop and ask the mechanic to write a damage report instead of a cost estimate.
EZ Insurance is a licensed and professional auto insurance provider that can provide you with cheap insurance in Texas. If you’re looking for affordable insurance in Austin, contact us today to request a quote.