How fleets can deal with the shocking rise of crash-for-cash scams

By Richard Peak, director at Nextbase 

Crash-for-cash scams are becoming a more and more pressing issue for drivers across the country.

Reports from the Insurance Fraud Bureau (IFB) found that 2,250 people have been victims to this form of scam over the past two years.

If this is a growing concern for regular drivers, fleets need to be wary as well.

The term ‘crash-for-cash’ refers to staged incidents, whether that be a manufactured vehicle collision, or some other kind of incident where one party wants the crash to happen.

They are perpetrated by fraudulent individuals who want to benefit from the insurance claims made on said incident.

Fleets in particular can fall victim to these scams, as drivers spend more time than most on the roads, just by being on the roads you make yourself a target.

Recent research from Nextbase found that there has been a 200% increase in crash-for-cash footage being sent to insurance companies, equating to hundreds of thousands of incidents being recorded.

In fact, we estimate that around 3% of road users will fall victim to this in 2023. But, as already stated, that figure could be higher for commercial drivers; 3% may not seem like much but the larger your fleet the closer you come to it being almost a certainty that it will happen to one, or more, of your drivers.

The different forms of crash-for-cash scams

There are a variety of ways that crash-for-cash scams manifest themselves on the roads.

‘Induced incidents’, involve fraudulent drivers targeting innocent motorists, and creating a real-life scenario for a vehicle collision to occur, ensuring that the unassuming motorist is to blame.

You may have seen videos of motorcyclists throwing themselves, cartoon-like, onto the bonnet of a car.

In the instance that such an attempt is recorded it is almost comical, other than the damage to the vehicle.

For those where it is not recorded, there is nothing funny about losing a no claims bonus or having to fork out compensation to a fraudster.

‘Ghost incidents’ also can be difficult to navigate, as the perpetrators take it upon themselves to make false statements against drivers, when an incident never even took place in the first place.

It is less likely that these will result in you having to pay out, but as much as anything it is a waste of time that helps no one.

How are fleets affected?

These scams can bring on severe financial impacts to fleets, as their success can lead to increasing insurance premiums.

It may also be necessary to put more resources into operating costs and involve law enforcement to help in finding resolutions to the incidents.

Fleet managers may even have to temporarily cease operations entirely, as vehicles would have to be taken off the road while investigations take place.

Protecting your fleet

In any case of a fraudulent claim being made against a fleet vehicle or driver, legal actions should be pursued. However, there are ways in which you can avoid crash-for-cash incidents entirely.

Providing drivers with scenario-based training before they embark on journeys can help with awareness of the signs that an incident can occur before fraudulent motorists attempt to take advantage of the situation.

Most of the time, drivers are relatively trusting of other road users, but it pays to be aware of what is going on around you.

That bike coming toward you? Don’t assume they will stop in good time. The car reversing in your direction? They may not stop when you think they will.

Making use of technology in the vehicle itself can help monitor drivers on their journeys, can help detect any unusual behaviour and the driving patterns of other motorists.

Equipping vehicles with a dash cam is a simple way to separate fact from fiction.

Keeping a visual record of any incident taking place bodes well in identifying when a crash-for-cash scam is taking place.

Fraudulent crash-for-cash incidents shouldn’t be taken lightly, so it's important to prepare for the worst-case scenario, and hope for the best in finding a solution to these scams.