Some people go to great lengths to commit vehicle insurance fraud, says Ray Albertini, special investigations director for Progressive, the third-largest auto insurer in the U.S.
A common type of fraud is buying insurance coverage after a vehicle has been damaged. Less common is when someone tries to buy it at the scene of an accident.
That was attempted by a motorcyclist who had wiped out. While lying on the side of the road with a ruptured spleen, he had the presence of mind to call 1-800-PROGRESSIVE to buy coverage.
He didn't know a witness overheard the call. Busted! But a lot of scam artists get away with it — and it costs society in general.
“Most insurance companies base their rates on the cost of doing business,” says Albertini. “When costs go up because of fraudulent claims, other customers end up paying the price.”
Here are other fraud cases from Progressive's files:
- A couple's car caught on fire. While he was on the phone with Progressive buying a policy, his wife was overheard yelling that the car was about to explode.
- Two brothers were hired to torch a car and make it look like an accident so the shady owner could collect insurance money. They doused the car with gasoline and — to make sure it was completely destroyed — tossed in a pipe bomb. The ensuing explosion set one of them on fire. His brother rushed to his aid. He caught fire, too. He flagged down a state trooper — en route to investigate the smoke — confessed, then died. So did his brother.
- A man reported parts stolen from his car. To support his claim, he submitted photos. Investigators thought they looked odd, then realized they were close-up pictures of a toy car.
- A woman crashed her boyfriend's motorcycle. She wasn't hurt. But her boyfriend, afraid his insurance wouldn't cover damages caused by a driver not on the policy, claimed he was driving. Figuring he needed injuries to bolster his story, he tied himself to a truck and had a friend drag him around. He got the desired injuries. But his girlfriend ended up telling investigators what really had happened.