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Common Forms of Car Insurance Fraud

Categories: Law and Finance
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Smiling couple buying a new car from a salesmanToday, getting car insurance is a legal necessity in all states. Many people are now taking advantage of various loopholes in the auto insurance sector to make an easy buck. Unfortunately, many of those accused of car insurance fraud have no idea that they have committed a white-collar crime.

These perpetrators do not also see the need for a criminal defense attorney from Marysville since they assume that these are petty accusations. A conviction for auto insurance fraud, however, attracts hefty penalties, including jail time, fines, probation, disgorgement, and restitution. Here are some of the actions that constitute auto insurance fraud:

Hard Fraud

This is the most severe form of car insurance fraud. It constitutes all deliberate actions designed to over-bill your insurance agency. Some types of hard fraud include faking a car accident or theft to be paid or causing a disaster such as braking too hard that another car rear ends you.

Soft Fraud

In soft fraud, you are caught up in a genuine accident or theft and deserve compensation, but you file an inaccurate insurance claim. The claim is generally exaggerated and includes a falsified report to get more money than you deserve. Providing false information to your insurer when buying a policy to get a favorable rate is also considered soft auto insurance fraud.

Aftermarket Add-on Fraud

It is usual to get extras for your car, like new shifters, rims, and steering wheels. If you are involved in an accident, removing these add-ons after your insurance payout can be deemed fraudulent. Aftermarket add-on fraud is usually unintentional and sort of a legal grey area.

Most people who commit auto insurance fraud think that it is a faceless crime. The given kinds of fraud result in losses and increase the premiums for auto insurance. Hence, car insurance fraud is tried as a felony.