Beware of car insurance frauds! Car insurance fraud is neither new nor unfamiliar to many of us. You must have heard the news on how people got scammed for nearly a hundred thousand. It is scary and very discomforting as it could happen to anyone, even you.
They look just like typical car insurance agents or towing truck services. You might not even expect them to be frauds at first. Be careful, do not get trapped by these car insurance scammers.
Car insurance frauds are constantly on the rise these days. Hence, arm yourself with the necessary knowledge to avoid becoming a victim. Read on as we share more on this matter.
What is car insurance fraud?
Insurance fraud is any act committed to defraud an insurance process. This may occur when a claimant attempts to obtain some benefit or advantage to which they are not otherwise entitled.
The essential components of insurance fraud are including:
- Intend to deceive
- Desire to induce insurance company to pay more than it otherwise would.
Types of car insurance frauds
What is the type of insurance form that you need to look out for?
There is various form of car insurance fraud. Read on as we share more about the matter.
Fake agents
This may occur when an unlicensed insurance company or someone purporting to be an agent of an insurance company.
These individuals will pose as insurance agents and sell fake insurance policies to consumers. They may apply for a genuine policy in your name. However, they keep your premium payments and cancel the policy shortly after without your knowledge.
You may only find out that the policy was canceled after you have to make an insurance claim. There is no legitimate policy in place. As a result, your claim is void.
Therefore, please be careful when engaging with agents. This could hurt and put you, your family, and your finances at risk.
Staged accidents
Fake accidents can happen when you drive, reverse, or park your car. Fraudsters set up these car accidents in order to commit car insurance fraud or file a fraudulent personal injury claim.
These are the example of staged accidents that you must be aware of:
- Bogus claim for an accident or injury that has never happened
- Claiming against a personal accident insurance policy for self-inflicted injuries
- Staged slip and fall accidents
- False claim of foreign object in food or drink
- Faking a death to collect benefits or filing a false death claim
- Staged burglary, theft or vandalism
- Arson
- Staged motor theft
- Staged homeowner accidents
Exaggerating the amount of losses
They will claim an exaggerated claim where the value of goods stolen or damaged is greater than the true value.
The followings are the example that you should take note of:
- Inflated or ‘padded’ claim where the extent of damage or injury sustained in a genuine accident is exaggerated
- Inflating value of items taken during a burglary/theft
- Medical service providers inflating medical bills
How to protect yourself against car insurance frauds?
The followings steps are helpful tips to protect yourself from becoming a victim of car insurance fraud.
Do a thorough research on the insurance company
You are paying for your car insurance with your hard-earned money. Be more careful by studying the insurance company first. Make sure the company is registered and legit before you commit.
If you are purchasing through an agent, you may contact an insurance-related organisation to ensure the agent is an authorised agent
Example is Persatuan Insuran Am Malaysia (PIAM).
Never sign a blank form
Do not sign a blank form or a cheque to avoid fraud. You should either fill up the application form yourself or purchase the policy directly from an insurer.
Avoid paying in cash
You may opt to pay online using a credit card or net banking. Always pay the premium directly to the insurance provider instead of your agent. Please request a receipt as proof of settlement for every time you make the payment.
The receipt is necessary in case the policy is forged. You may use the receipt as evidence in court to sue the fraudulent insurer.
Unusually low premiums
Although it may sound good to pay low premiums, be careful!
Cheap insurance offers are rarely legitimate. Any policy with inexplicably low rates likely lacks essential coverage or could be invalid.
Don’t fall into the trap just to save your money. You are paying for nothing.
Install a dashcam
A dashcam is helpful to record any collisions you have. Your dashcam records will protect you as evidence in the event of any possible stage accident scam. There are plenty of choices of dashcams available online.
You may choose the higher-end ones for better visuality. But you can still buy a cheap one that fits your budget.
A low-budget camera is better than nothing isn’t it?
Be careful of potential car insurance frauds
Don’t be a victim of car insurance fraud. Be wise and do your homework before purchasing any insurance. Buy car insurance from a reputable insurance company to prevent fraud.
You may purchase with Bjak, an insurance platform to renew insurance and roadtax, trusted by over 3 million users.
Simply visit Bjak for more information regarding insurance purchases. There are 15 insurance brands available for you to choose from. Get a free quote in just 3 minutes.
Bjak is one of Malaysia’s biggest insurance comparison websites, offering policies from over 10 brands. Get your free insurance quote from Bjak today!
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