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Staged Accidents - What to Watch Out For

July 20, 2011

Insurance fraud involving staged accidents is a growing problem in Canada. These schemes are dangerous for a number of reasons. They can go wrong and cause actual injuries to the innocent drivers being targeted, and even when the only "injuries" are false ones claimed for the purpose of collecting damages, they do economic harm by driving up the cost of insurance for all drivers.

Fortunately, there are some things that drivers can do to help protect themselves from being targeted for this type of insurance fraud.

Risk Factors

Drivers can exercise additional vigilance and caution to avoid being singled out by criminals who stage accidents. In particular, older drivers and women drivers (especially when alone in the car) should pay special attention as these two groups, are more likely to be targeted.

Staged accidents are relatively infrequent in rural areas. Most incidents occur in cities, and a disproportionate number happen in wealthier urban areas because drivers there are likely to have additional insurance coverage.

Ontario has recently enacted legislation to help make sure that there is less financial incentive for insurance fraud, but the problem remains.

Scenarios to Watch For

Staged accidents fall into several major categories. One common scenario is the "panic stop." In this scheme, a car in front of the target's vehicle suddenly slams on the brakes, causing a rear-end collision. The panic stop scenario often involves several passengers in the criminal's car, each of whom will claim whiplash or other injuries.

Another trick often used is to gesture to the targeted driver that is it all right to merge or change lanes. When the target does so, the criminal will move his car into a position that causes a collision. The criminal will typically deny having given permission for the target to merge or change lanes.

A more complex scenario involves teamwork by drivers of two cars. Known as the "swoop and squat", this scheme is a variation of the panic stop. A criminal driver will move his car directly in front of the target's car. The second vehicle involved will suddenly merge in front of this car without warning, causing the first vehicle to stop, which in turn causes the target's car to hit the back of it. The second vehicle (the one that merged) then speeds away, and since the person driving it remains unidentified, the target -- or his insurance company -- will be responsible for damages and personal injuries caused by the accident.

Busy intersections, particularly those with double left turn lanes, are places where one driver may intentionally sideswipe another in order to collect on insurance.

What to Do if You are Targeted

Panic and confusion are common reactions after an accident, but clear thinking (and preparedness) in the wake of one can prove helpful in the long run. Keep a pad of paper in your car, along with a writing utensil so that you can write down pertinent information including:

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