In the face of the current recessions and its probable long financial dry spell there have been reports of increased car insurance write-offs of cars. On top of that there were also increases in the number of car accidents which led to write-offs. This strange occurrence isn't confined to this recession but has also been observed in other times of economic contraction.
This strange correlation between recessions and write-offs isn't statistically or logically related. There should not be a connection between these two occurrences as they should not affect each other but strangely they do and the worst thing is that the car insurance companies are taking notice of this.
The fact is that many people who are in financial difficulties will turn to insurance fraud to get themselves out of trouble. Some of these unscrupulous people will actively do damage on their own cars in the hope that their car insurance providers will cover their losses. Although it is a very despicable act, the problem of proving that these people have actually actively tried to deceive the insurance companies is difficult at best.
Some of these insurance fraudsters will even go to the extent of driving their cars into barriers, fire hydrants and even other motorists just to make their claim look more believable. They are even willing to risk their lives just for a chance at obtaining a claim. The sad part about all of this is that most of these people do not understand how the claims process works. It could be months even years before all due investigation is completed and you receiving your claims. By this time your financial situation would have changed substantially.
Some other individuals have even resorted to torching their cars or even reporting that it was stolen simply to get their car insurance claims come through better. These criminal acts are very obviously against the law and if even the slightest issue arises the insurance company is simply not going to pay your claims. There simply is no situation where you should ever be resorting to insurance fraud to either get a cash benefit or to get rid of you car.
Most of the time if you find that you are having a hard time servicing your car loans or even if you can't seem to sell your car and it is really becoming a liability, it still isn't worth it to resort to criminal acts and insurance fraud. You can sell you car for cheap and restructure your car loans in such a way that you can still pay them off effectively over time. If your car insurance is heavy then you can reduce your coverage or even changing your policy to a third party option.
These increased incidences of less than truthful write-off claims have a very negative impact on the rest of the people in the insurance pool in the company. As a customer of the insurance company you will have to pay for any of these write-offs through your increased premiums. The unfortunate truth is that most insurance companies know that this is happening especially in these troubling economic times, as such those that do not have a fixed policy will end up having to pay for the extra risk that is involved. There is almost no way to avoid this as every car insurance company will face the same issue and thus will penalize every policy holder equally for this just to make sure they don't see a loss.
Although authorities and insurance companies want to keep this to a bare minimum it really is hard to prove that insurance claims are fraudulent. For most of us other car insurance policy holders we will just need to understand that our rates are increasing simply because of these activities and plan accordingly. There is nothing else we can do except to accept it and understand that we aren't the only people that are penalized, everyone is getting it.
This strange correlation between recessions and write-offs isn't statistically or logically related. There should not be a connection between these two occurrences as they should not affect each other but strangely they do and the worst thing is that the car insurance companies are taking notice of this.
The fact is that many people who are in financial difficulties will turn to insurance fraud to get themselves out of trouble. Some of these unscrupulous people will actively do damage on their own cars in the hope that their car insurance providers will cover their losses. Although it is a very despicable act, the problem of proving that these people have actually actively tried to deceive the insurance companies is difficult at best.
Some of these insurance fraudsters will even go to the extent of driving their cars into barriers, fire hydrants and even other motorists just to make their claim look more believable. They are even willing to risk their lives just for a chance at obtaining a claim. The sad part about all of this is that most of these people do not understand how the claims process works. It could be months even years before all due investigation is completed and you receiving your claims. By this time your financial situation would have changed substantially.
Some other individuals have even resorted to torching their cars or even reporting that it was stolen simply to get their car insurance claims come through better. These criminal acts are very obviously against the law and if even the slightest issue arises the insurance company is simply not going to pay your claims. There simply is no situation where you should ever be resorting to insurance fraud to either get a cash benefit or to get rid of you car.
Most of the time if you find that you are having a hard time servicing your car loans or even if you can't seem to sell your car and it is really becoming a liability, it still isn't worth it to resort to criminal acts and insurance fraud. You can sell you car for cheap and restructure your car loans in such a way that you can still pay them off effectively over time. If your car insurance is heavy then you can reduce your coverage or even changing your policy to a third party option.
These increased incidences of less than truthful write-off claims have a very negative impact on the rest of the people in the insurance pool in the company. As a customer of the insurance company you will have to pay for any of these write-offs through your increased premiums. The unfortunate truth is that most insurance companies know that this is happening especially in these troubling economic times, as such those that do not have a fixed policy will end up having to pay for the extra risk that is involved. There is almost no way to avoid this as every car insurance company will face the same issue and thus will penalize every policy holder equally for this just to make sure they don't see a loss.
Although authorities and insurance companies want to keep this to a bare minimum it really is hard to prove that insurance claims are fraudulent. For most of us other car insurance policy holders we will just need to understand that our rates are increasing simply because of these activities and plan accordingly. There is nothing else we can do except to accept it and understand that we aren't the only people that are penalized, everyone is getting it.
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