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Auto Insurance Fraud

As a chiropractor part of my job is taking care of people whom have been in auto accidents. As I have written about before, being in a car accident  is one of the most damaging events you can put your spine through and people whom have been in one legitimately need care.

There is a dark underside to these accidents that a lot of people are not aware of.  Let’s say you are the driver of a car that rear ends the car in front of you.  That person could sue you for injuries sustained in this accident. How bad do they have to be hurt to sue you? Much less than you may think.

Here is where it gets ugly.

The possibility of financial gain has led people to staging accidents. How does this work? You put 6-8 people in a car and pay someone to hit it. The “victims” go to a doctor like myself and run up bills of at least $2,000. That triggers a threshold that allows them to sue the person that hit them. The “victims” ask for a small enough amount that the insurance company settles with them in order to avoid long term litigation.

You may ask, “If it is a small enough amount who really cares?”  Not a bad question if it was occasional, however, when this happens hundreds and thousands of  times a day, the money becomes very real, very quick.

Here in Massachusetts, a 65 year old woman died in a stage auto accident in 2003 in Lawrence which at that time was known as the auto insurance fraud capital of Massachusetts.

The Lawrence police joined forces with a fraud bureau and went to work on steadily reducing auto insurance losses with the thought being they would be able to reduce the amount of insurance premiums that you and I pay.

Were they successful? Were they ever! The crackdown led to charges being filed against 488 people in Lawrence. 488 in Lawrence alone!! That is crazy!

Here is where it gets good. The average auto insurance premium in Lawrence was $1613 in 2003. Today it is $1260! Collectively across the state there has been a $266 million reduction in claims dollars statewide.

Why This is So Important

When there is a lot of fraud, the innocent people get swept up in the mess. The patients that were hurt in legitimate accidents were being treated as if they were guilty of fraud.  The honest doctors and lawyers were getting hammered trying to help people that actually needed it.

As these task forces continue to do their work of reducing fraud, the honest people are going to benefit by getting both the health and legal help that they need.

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