March 2016 marks the 12th anniversary of Canada's Fraud Prevention Month. In 2004, the annual campaign was started in order to provide education and awareness for consumers across Canada. This year was marked with a major announcement by the Ontario Minister of Finance, Charles Sousa.
On February 25, 2016, Ontario Minister of Finance Charles Sousa announced that the government's budget includes a plan to establish a "serious fraud office" with a special focus on auto insurance fraud.
According to Kim Donaldson, Vice-President, Ontario, Insurance Bureau of Canada: "Auto insurance fraud continues to be a serious problem and has plagued the Ontario auto insurance system costing as much as $1.6 billion a year. We are thrilled to see the Government make the fight against fraud a priority."
Auto Insurance Fraud & Maintaining Awareness
The team here at Canada Auto Loan wants to bring awareness of the types of auto insurance fraud that can (and do) drive up the rates of conscientious car owners like you. And some of these practices can affect you in ways that go beyond harming your wallet.
- Vehicle Dumping
Also known as "Owner Give-Up," this is the fraudulent act of disposing a vehicle by the owner through abandonment, destroying it, or, in some cases, selling it. After which, the owner reports it as stolen. In cases where the owner has sold the car before reporting it stolen, the goal of the fraud is twofold: to begin with, the insurance company pays to replace the stolen vehicle, while the owner profits from the sale of the original car as well. Talk about bad business.
- Premium Evasion
The area you reside in affects what you pay for car insurance. This tactic is designed to mislead the insurer and avoid the expensive rates associated with higher risk areas by using an address from an area where lower insurance premiums are offered. - Inflating Accident Repair Costs
This type of fraud is especially nasty. A repair shop "repairs" your car after an accident, but the mechanics use secondhand/worn parts and then bill your insurance company for new parts that should have been installed, and pocket the extra money. Not only are they ripping off the insurance company, they are putting your vehicle and your safety at risk by using substandard parts. - Airbag Replacement
In another attempt to pocket extra cash, the mechanic will stuff the airbag compartment with a cheap airbag or stuff the area with junk or garbage in order to keep the sensors working. As with using subpar parts, this type of fraud can put you and others at a high risk for injury. - Faulty Windshield Replacement
This is a tricky one. These sneaksters claim to be windshield repair specialists, and will typically approach you in a parking lot and try to convince you that your windshield is damaged, and they just happen to have your type of windshield on hand. And they will tell you that it will be completely covered by your insurance policy. This scam affects you in two horrible ways: first, they will probably replace your windshield (which was fine to begin with) with a substandard one, which could endanger you and your passengers. Secondly, you could lose your coverage if the scam artist uses your policy information to submit multiple replacement claims.
As We See It
Insurance fraud can cost you more than just higher premiums. Always do your research on the reputation of a business before paying them to provide a service.
And if you need to find a reputable auto dealer that works with car buyers with damaged credit, Canada Auto Loan can connect you today. Just complete our easy, fast and secure online application to see what we can do for you.