Auto insurance fraud costs everyone money

Auto insurance fraud is continuing to cost motorists in California and other states a considerable amount of money.

Auto insurance fraud is continuing to cost motorists in California and other states a considerable amount of money.

This week, California Insurance Commissioner Steve Poizner announced that suspected cases of vehicle arson fraud rose by 25 percent in the state last year while phony theft reports were also up significantly. Other fraudulent activities such as over-inflating damage amounts have reportedly remained relatively stable.

"Many Californians are facing a host of financial challenges in today's economy, but I want to remind everybody that you will only compound your problems if you break the law and commit fraud in search of a quick fix," said Poizner.

In California alone, insurance officials have made more than 1,900 arrests in fraud cases since 2007. The Department of Insurance investigates possible cases of fraud that are referred by local law enforcement agencies, insurance companies and even other consumers.

Other states have experienced a similar trend, brought on by factors like the recession and high unemployment, which has more drivers unable to make their monthly vehicle payments.

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Posted: July 29, 2009

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