The insurance industry estimates that between 10% and 20% of all automobile insurance claims are fraudulent. Automobile insurance fraud has historically taken on several forms:

Automobile Property Fraud
This fraud involves individuals who fraudulently report their vehicles stolen or vandalized in order to collect on insurance, or who fraudulently report that vehicle parts have been repaired or replaced.

Staged Automobile Accident
These “accidents on purpose” may involve innocent victims and are often orchestrated by organized auto accident rings. Another variation is that of the paper accident which involves the creation and report of an “accident” that exists only on paper. Auto insurance fraud is a growth industry that affects us all. According to the State Department of Insurance the number of suspected auto insurance fraud cases referred to its Fraud Division for investigation has tripled since 1991 and ultimately costs every insured Californian from $200 to $250 annually for inflated and fraudulent auto claims.