In my publish about illegal immigration, a commenter identified that I used to be fortunate to keep away from higher monetary penalties from my “automobile accident.” It seems that the maneuver the place a automobile accelerates from a cease after which abruptly slams on the brakes is a standard insurance coverage rip-off. This tactic is named the “sudden cease” or “brake test” scheme.
I began researching extra about this sort of fraud as a result of it had crossed my thoughts throughout the accident. Out of nowhere, after accelerating arduous, the automobile in entrance of me slammed on the brakes for no obvious motive—she had the best of method on the intersection. Fortunately, I used to be shifting slowly, barely reaching 3 mph towards the cease signal, earlier than slamming on my brakes and bumping into her automobile.
Might Have Been A Setup
Later that night, a reader from San Francisco reached out, sharing an identical expertise from simply the opposite month. What was exceptional was that it occurred on the identical intersection: the three-way junction of Sloat Blvd, Skyline Blvd, and Lake Merced Blvd.
And once they pulled over on the identical spot on Skyline Blvd, simply earlier than Zoo Street, the opposite driver was additionally a lady who didn’t converse English. Conveniently, there simply so occurred to be a person on the aspect of the highway who might translate for her. What are the probabilities?
That made me replay the main points of my very own encounter. It occurred at 2:57 pm on a Thursday, and the one different factor I remembered was seeing individuals in a automobile coming from Lake Merced Blvd who have been watching and laughing, as in the event that they knew it was a setup. How unusual, I bear in mind pondering.
Have been we victims of a staged automobile collision? I’m unsure since no cash was extracted from me or my insurance coverage firm. Possibly once they pulled over, they anticipated to see harm to her previous automobile. However attributable to my reflexes, there wasn’t any, so they simply determined to let issues go.
Sadly for the reader, there was harm to the entrance individual’s automobile. So she is within the strategy of coping with her insurance coverage firm now.
In case you are a frequent driver, beware that you may be getting arrange for automobile insurance coverage fraud. When you don’t suppose automobile insurance coverage fraud impacts you, suppose once more. Billions of {dollars} are misplaced to fraud annually, driving up premiums for everybody.
I needed to do extra analysis!
Case Research on Automotive Insurance coverage Fraud
Beneath is the very first thing I discovered about automobile insurance coverage fraud from California’s Department of Insurance. Los Angeles, which accounts for almost 43 % of all auto-related insurance coverage fraud in California.
On February 24, 2021, Zandra Monterrozo, 44, of Corona, pleaded responsible and was sentenced for her involvement in an organized ring that staged automobile collisions to gather over $135,000 in fraudulent insurance coverage payouts. Eleven different suspects, which included physique store house owners, have been additionally charged or prosecuted.
Record of 11 extra suspects:
- Bethuel Guevara Aguirre, 39
- Monica Elizabeth Sosa Alonzo, 39
- Baudilio Enrique Noguera, 49
- Juan Venancio Juarez Miranda, 49
- Carlos Enrique Lopez, 56
- Emma Amparo Lemus Martinez, 59
- Osmar Fernando Lopez, 40
- Alfonso Leon Baltazar, 51
- Mario Renee Alonzo, 67
- Marcos Farias, 70
- Walter Chacon, 31
Monterrozo was sentenced to 1 felony depend of insurance coverage fraud, ordered to pay $6,000 in restitution, and served one 12 months of probation. I am unsure what occurred to her different potential accomplices.
The rip-off includes one automobile deliberately braking rapidly with out motive, giving the motive force behind little time to react, inflicting a rear-end collision. The investigation revealed the ring was accountable for eight staged collisions involving harmless victims, and two collusive ones, leading to $137,832 in losses for victims and varied insurers.
Sounds lots like what each a reader and I skilled.
How the Brake Test Rip-off Works
Right here’s how scammers revenue from the brake test scheme, typically with the assistance of a mechanic or clinic.
After forcing a collision, the scammer claims minor harm, like $1,000. They then enlist a shady mechanic who “finds” a further $5,000 value of harm. The mechanic payments the insurance coverage firm $6,000, they usually cut up the additional $5,000 that was by no means spent on repairs.
Along with damages, scammers could declare medical points like whiplash or again ache to inflate their payout. With a number of passengers, every individual can file separate claims for “accidents,” doubtlessly incomes much more. Ideally, a fraudulent clinic is concerned, so the scammers can cut up the insurance coverage funds from faux medical therapies as properly.
One other approach to extract cash from the sufferer is thru intimidation. After the accident, the scammers could demand money or valuables, with the translator abruptly turning into a threatening determine. If there’s little harm to the scammer’s automobile they usually consider the insurance coverage firm received’t pay out, the brake test incident can escalate right into a mugging.
Purple Flags of a Staged Collision
When you suspect you are a sufferer of a staged collision, look out for these indicators:
- The opposite automobile is stuffed with passengers to extend the potential quantity for monetary payout.
- The motive force has a brand new insurance coverage coverage or no insurance coverage coverage.
- Their automobile is in poor situation or has a salvage title.
- Site visitors was flowing easily, however they stopped abruptly.
- The motive force and passengers all declare damage regardless of minimal harm.
- There are random witnesses who all occur to be of the identical background of the opposite driver.
Video of Brake Checking and Different Reckless Driving Conduct in Motion
One widespread criticism I obtained from readers is that the accident was solely my fault since I rear-ended the automobile. I acknowledged that it might have been, even with the sudden braking, and had no downside exchanging ID and insurance coverage info.
Some readers mentioned I used to be out of line for asking for the opposite driver’s ID and insurance coverage. My unhealthy. I assumed it was customary protocol, since that’s what you do when coping with the police or any visitors incident. I haven’t been in a automobile accident since faculty, and I favor figuring out who I’m coping with after an accident.
Others blamed me for tailgating. I don’t find out about you, however after I’m at a cease signal or crimson gentle, I usually go away about three toes of house—sufficient for somebody to comfortably stroll between the automobiles. Tailgating doesn’t appear as related when the automobiles are stationary. If a automobile abruptly accelerates and slams on the brakes, even from a standstill, it is arduous to react rapidly sufficient.
Such a response is without doubt one of the causes automobile insurance coverage fraud by brake checking is such an efficient rip-off. If the motive force within the rear is at all times blamed, regardless of the circumstances, scammers are incentivized to make use of the brake test scheme to money in.
For individuals who insist the entrance driver isn’t at fault, take a look at this video that reveals quite a few examples proving in any other case. Earlier than leaping to conclusions, bear in mind there are at all times two sides to each state of affairs.
Is Defrauding Auto Insurance coverage Corporations Price It?
I am all for side hustles to make more money, however auto insurance coverage fraud does not look like a superb return on effort. Take the case of Zandra Monterrozo. She collected $137,832 in fraudulent claims, however it took eight staged collisions with harmless victims and two collusive crashes to get there. Staging 10 collisions is a variety of work!
Not solely is it time-consuming, however there’s additionally the chance that the insurance coverage firm may not pay out. In the event that they don’t cowl a minimum of the automobile’s harm, you may find yourself shedding cash. And it is unlikely that fraudulent claims have a 100% success price, particularly when insurance coverage firms are skilled at recognizing these scams.
One other draw back of insurance coverage fraud is having to share the earnings. Monterrozo needed to cut up the $137,832 with 11 different individuals. That brings the typical payout per individual to only $11,488. Even when some took extra and others much less, it’s arduous to think about the ring chief strolling away with greater than half the entire quantity.
One other draw back is stepping into an accident with the unsuitable sufferer. What if the individual does not keep calm like I did and as an alternative pulls out a knife or gun to retaliate? The sufferer might simply get pissed off as a result of they are going to suppose the accident was your fault. That’s a danger that doesn’t appear value taking.
Lastly, there’s the chance of getting caught. Monterrozo obtained a comparatively gentle sentence—$6,000 in restitution and one 12 months of probation. With such lenient penalties, it is easy to see why some scammers may be tempted to attempt once more.
Let’s Have Compassion For The Victims Of Insurance coverage Fraud Too
Whereas it is tempting for fraudsters to take advantage of the system, it is not a sustainable or risk-free approach to earn a living. For the typical individual, collaborating in an organized scheme like this isn’t well worth the authorized and monetary penalties.
I perceive that determined instances can result in determined measures. Empathy for perpetrators is a key precept for reformative justice advocates. In case you are poor or an unlawful immigrant with out many monetary choices, the temptation to partake in a automobile insurance coverage rip-off for a fast $500 is comprehensible.
Nonetheless, if we’re going to take a softer method to crime, we should additionally guarantee victims are compensated for the harm and struggling they endure too. Let’s not deal with criminals higher than law-abiding residents.
Advice For Drivers To Defend Themselves In opposition to Automotive Insurance coverage Fraud
Now that you just’re conscious of the brake test scheme and different staged collisions used to rip-off insurance coverage firms, listed below are some steps to guard your self:
- Set up a entrance and rear-facing digicam that constantly data whilst you drive. This offers essential video proof in case you’re concerned in a staged collision. One advice my shut pal makes use of is the Pulse P12 Pro 4K Mirror Dash Cam. It prices about $200-$300 to put in.
- Drive a modest however secure automobile. Stagers typically goal high-value automobiles like industrial vehicles, luxurious automobiles, or government-owned automobiles, as these are nearly assured to have insurance coverage protection. Automotive insurance coverage fraud is another excuse why training Stealth Wealth is vital. You change into much less of a goal.
- At all times insist on a police report on the scene of the accident, and ask the officer to positively determine all events concerned.
- Completely doc the accident. Use your cellphone to take photographs or movies of the collision, together with any harm to the automobiles.
- Report the suspicious collision to your state’s Division of Insurance coverage. They could have helpful info and assets to help you.
- Think about getting tinted home windows. Relying on the place you reside, you’re legally allowed to tint your home windows as much as a sure restrict. Think about going to that restrict. The darker your tint, the more durable it’s for others to see. This creates extra danger for fraudsters to choose on you.
- Get the best insurance coverage insurance policies. Along with reviewing your auto insurance coverage coverage, it’s value contemplating an umbrella policy for added legal responsibility safety. Communicate along with your insurance coverage supplier not solely about automobile insurance coverage but additionally about scams just like the brake test scheme. Ask for his or her suggestions on the suitable protection quantities for every kind of insurance coverage to make sure you’re absolutely protected.
No person Actually Cares, So You Should Be Vigilant
Accidents occur on a regular basis. Even in case you’re the sufferer of fraud, individuals will nonetheless discover a approach to blame you, typically displaying little sympathy to your state of affairs. And in case you admit the accident was solely your fault, individuals will bounce on the probability to tear you aside and take full benefit.
It’s a tricky world on the market, of us. Defend your self and keep secure!
Reader Questions
Have you ever ever been a sufferer of automobile insurance coverage fraud or every other kind of insurance coverage fraud? If that’s the case, how did it occur, and the way a lot did the perpetrators get away with? When you work within the auto insurance coverage business, I’d love to listen to your insights on automobile insurance coverage fraud. What’s the denial price, and the way typically do insurance coverage firms detect fraudulent claims?
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