Auto Insurance Law

In the United States auto insurance fraud is becoming one of the biggest fraud problems this country is faced with. In this article we’re going to discuss some of the more common auto insurance fraud scams and what somebody can do to prevent them.

Today one of the most popular insurance fraud scams involves auto insurance and auto accidents. More specifically, staged auto accidents. These have actually become quite complex to the point where they involve multiple participants. There are many variations of these. We’ll cover the main ones here.

First there is what is called the swoop and squat. This scam involves three vehicles. Two are driven by the criminals and the third is driven by the victim. The driver of the “squat” vehicle positions himself in front of the victim. The person driving the “swoop” vehicle pulls ahead of the squat vehicle and intentionally cuts the vehicle off. This causes the driver of the squat vehicle to slam on his brakes and stop short. Usually, the victim can’t react quickly enough and rams into the squat vehicle. In the meantime, the swoop vehicle that caused the accident takes off and is never seen again. The victim tells police that the swoop vehicle caused the accident, but because that vehicle can’t be located the victim ends up having to pay for the damage and any personal injury claims.

Then there is what is known as the side swipe. This type of accident usually happens at busy intersections with dual left hand turn lanes. The criminal positions his vehicle in the outer left turn lane. When the victim’s vehicle drifts into the outer turn lane the criminal side swipes him. To make sure the scheme works the criminal does preliminary surveillance to make sure that the intersection is busy enough where drifting will occur because of the amount of traffic.

Another common auto accident scam is what is known as the Panic Stop. In this scheme the criminal drives a late model car filled with a lot of passengers. The criminal will then position himself in front of the victim and have one of the passengers look out the back window watching to see for any signs of distraction such as answering a cell phone call or changing a station on the radio. Any sign that the victim is taking his eyes off the road. Once this happens the passenger signals the driver who then slams on the brakes thus causing an accident. The victim will claim that the criminal stopped short for no apparent reason but usually to no avail. In the meantime the victim has to pay for all damages and injuries reported.

Unfortunately there is only one way to avoid these type of accidents and that is to be observant at all times and keep a safe distance from any vehicle ahead of you. The sad truth is, if all motorists would just obey the speed and distance laws and rules, accidents like these would never happen. But people drive too fast and too close and thus these type of frauds will always be pulled off. Drive safe and smart and your chances of being the victim of auto insurance fraud will be greatly diminished.

By: Michael Russell

Do you think that illegal immigrants should be able to buy auto insurance?

New Mexico’s legislature passed a law in 2003 that allows illegal immigrants to get driver’s licenses so that the public would be safer. States regularly deny driver’s licenses to foreign citizens no matter what there immigrant status is. Some states like California began tightening their requirements for driver’s licenses, and many immigrants couldn’t renew their licenses, and their car insurance was cancelled automatically.

Some car insurance companies have seen this as a new golden market. Even though many states deny driver’s licenses to illegal immigrants, the law doesn’t prevent insurers from selling insurance to unlicensed drivers and car owners. Big companies like Progressive are writing car insurance for illegal immigrant drivers.

My first reaction to this story was anger. How could those insurance companies reward illegal immigrants with car insurance? But then, I calmed down and began thinking like an insurance claims professional.

The legal arguments about immigration are not my immediate concern, and they shouldn’t be yours, either. The most important thing you should consider is what happens to you if you get into a traffic accident with an unlicensed driver who has no car insurance.

How many times have you heard a news story that told about an illegal immigrant driver that caused an accident, and then took off on foot, abandoning their car? Sometimes, they’ll beg the other driver to let them pay for damages in cash, just so they are not discovered driving without insurance or confronted by police.

I like the fact that the insurance companies are taking a pragmatic position. Illegal immigrants are going to drive cars in North America. Few things will stop them. They are going to drive to and from work whether or not they have a license. Nothing prevents them from owning a car in any state that I know of.

By serving this growing market, the auto insurers are offering protection as they rightfully should. They are staying out of the political fray, and correctly staking their position in the free market. Certainly, this market of illegal immigrants is high-risk insurance, and so the insurers are charging high-risk rates for auto policies. But that’s no different than charging higher rates for American citizens that have had a DUI. Risky behavior gets you higher rates.

But the insurance companies are finding that the illegal driver segment is very profitable. The insurance companies experience good “retention,” meaning that the policies renew regularly. Just as important is the fact that illegal immigrants seldom report small accidents to lower the chances that they’ll have a brush with the law. Companies like Progressive, Farmers Group, Bristol West, Infinity P&C and Alliance United are putting a lot of effort into expanding this part of their book of business.

So, in this case, I think the insurance companies are doing the right thing. The more illegal immigrants that have car insurance, the more we all will be financially protected.

By: Russell Longcore

Understanding the medical payments coverage in Arizona auto insurance policies can seem tricky. Most insurance companies come with several different and optional plans to choose from and buy. Medical payments is just one of those options. Having medical payments is highly recommended, but not mandatory to have on your Arizona car insurance policy.

Arizona Medical Payments Coverage Explained

Medical payments pays for medical expenses in the event that you and those in your car are in an accident. It can also pay for your family members who are riding in another vehicle, or walking down the street. It is completely optional for Arizona policy holders, but is highly recommended because it pays for hospitalization, medical and dental treatment, funeral expenses, prosthetics, and/or nursing services.

Do I Need Medical Payments Coverage In My AZ Auto Policy If I Already Have An Arizona Health Insurance Policy?

If you already have health insurance, having medical payments coverage on your Arizona auto policy may be unnecessary because your health insurance should cover the same events. Of course this is something that you should discuss with your insurance agent to be sure.

It is always better to be safe than sorry when it comes to you and your family’s protection. If you don’t have health insurance and are looking for a good way to protect yourself in the event of a life-threatening accident, medical payments would be an excellent option to put on your Arizona auto policy. It’s a relatively cheap way to increase your protection on the road so be sure and ask your agent how much this optional coverage will cost to add on to your policy.

All you have to do to start finding out just how cheap your medical payments coverage on your Arizona auto insurance policy can be is to get started comparing rates!

By: James J. Robinson