The COVID pandemic has created a spike in fraudulent claims targeting vocational trucks by instigating staged accidents, which involves maneuvering an unsuspecting employee driver into an intentional crash in order to make a false insurance claim or to file a lawsuit against the company if it is self-insured.
Staged crashes first emerged in the in the U.S. in the 1990s and since then has grown to be the No. 1 insurance fraud scheme, according to Friss Insurance Fraud Report. The National Insurance Crime Bureau (NICB) describes staged accidents as a “big business” that company drivers should know how to spot and handle.
Since commercial vehicles are favorite targets for staged accidents, some companies have removed branding from their vehicles to make them less conspicuous as business vehicles. Perpetrators of staged accidents intend to illegally make money by submitting fraudulent insurance claims or filing a lawsuit against a company.
While some staged accidents are amateur affairs, many are carefully planned and practiced in advance of the actual incident. These criminals target commercial vehicles because they believe the monetary settlement will be much larger than crashing into a private individual. A logo or company name on the side of a commercial vehicle will increase the potential for a staged crash to occur. In a perverse rationalization, these criminals view work vehicles as a victimless crime because the company’s insurance will cover the expenses. Insurance scams on these vehicles are more lucrative because criminals know that a company vehicle will be insured or if it is self-insured, accomplice attorneys know most companies will settle out of court once a lawsuit has been filed. For a vocational business operating only a few vehicles, it will, on average, carry a minimum of $1 million in liability insurance.
While staged accidents happen throughout the country, most incidents occur in states with no-fault laws, which require insurers to reimburse policyholders for medical expenses regardless of who is at fault. According to the NICB, the top five staged accident states are Florida, New York, California, Texas, and Maryland. The five cities with the most staged accident claims are New York City, Tampa, Miami, Orlando, and Houston. Florida is the only state that has specific legislation against staged accidents. Other state legislatures are deliberating bills targeting gangs that lodge fraudulent crash-injury claims or engage in staged accidents.
Types of Staged Accidents
The NICB identifies six situations where there is a high risk of a staged accident occurring:
The T-Bone Accident: In this scenario, a criminal will wait for a company vehicle to proceed through an intersection and then accelerate to T-bone your vehicle. When the police arrive, accomplice witnesses, also known as “shady helpers,” will claim your vehicle ran the stop sign or traffic signal.
The Wave: In this scam, the other criminal driver will notice an attempt to switch lanes and subsequently wave your driver ahead. As the driver maneuvers into the lane, the fraudster will accelerate, colliding with the fleet vehicle. When the police arrive, the fraudster denies the courtesy wave and faults your driver.
Dual Turn Sideswipe: A driver in the outer lane of the dual turn lanes rams into your driver the moment the company vehicle veers slightly outside of the inner lane while the two vehicles are making the turn. The criminal driver may also drive into your employee’s lane to sideswipe the vehicle and then blame your driver.
Swoop and Stop: A car will suddenly pull in front of your company vehicle and abruptly stop. Another vehicle will simultaneously pull up alongside your company vehicle to prevent it from swerving to avoid an accident.
Phony Injuries: In any fraudulent accident, your company may find yourself on the hook for injuries your driver didn’t cause. The criminal and accomplice passengers may collaborate with an unscrupulous physician or chiropractor and file personal injury claims for non-existent injuries. Some criminals visit legitimate doctors and claim whiplash or other difficult to detect soft tissue injuries.
Jump-ins: This occurs when people suddenly appear and jump into the scammer’s car claiming they were passengers. You should also be suspicious if the other driver and passengers report injuries, where there is only minor damage to the vehicles.
How to Deal with Scams at the time of Accident
The best defense against staged accidents is to drive carefully and to be vigilant to your surroundings. Do not tailgate to prevent the “swoop and stop” scenario. Many companies install dash cams to combat against these incidents, which record what occurred immediately before an accident. The more information you provide, the better equipped you are to fight an insurance scam.
Instruct your drivers to use their phone to immediately photograph all damage done to the alleged fraudster’s vehicle, as well as everyone who was in the vehicle, and record their contact information. Doing this will limit their ability to exaggerate the damage done to their vehicle. Pay special attention to the number of people in the other car and the damage to both vehicles. Snap photos from every angle of the involved vehicles, with special focus on the damage. Also, capture on camera the license plate of the other vehicle. Beware of tow trucks that appear when you have not called for services, as they are typically part of the criminal scheme. Always call the police even if damage is minimal to generate an official police report.
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