Workers at auto body shops deliberately damaged cars,
Installed used parts but billed for new ones, or invoiced for phantom repairs, according to an investigation by a Canadian insurer that, is calling on government to help in curbing the problem. Aviva Canada found about half the total expenses submitted for repairs, to crashed vehicles during its investigation in Ontario were bogus — an amount the company estimates adds up to hundreds of millions of dollars a year.
Aviva attempted to simulate typical fender-bender situations involving private passenger cars by, deliberately crashing 10 vehicles. The company had experts detail the damage and estimate repair costs, then kitted out the cars with hidden cameras and, at various times, put them on highways in the Toronto area. Investigators posed as hapless drivers just having gone through their first crash.
Only one repair outfit acted honestly. The other nine cases showed some degree of “clear cut” fraud. While Aviva’s experts had estimated total damage for the 10 vehicles at about $30,000, the repair shops invoiced Aviva for about $61,000. Tow-truck drivers who billed for towing and storage that didn’t happen, drivers who were asked to sign blank work orders, cars maliciously damaged at body shops, and shenanigans over repaired or replaced parts. Industry estimates suggest between five and 15 per cent of premiums drivers pay for car insurance go toward covering undetected fraudulent claims.
“In Canada, insurers are not only not compelled to report fraud, they’re not even compelled to do something about it”. “The insurers themselves don’t seem to be able to get their act together on this problem.” for example a tow-truck driver who gets paid to take a vehicle to a specific facility — and making it illegal to ask consumers to sign blank work orders are other measures the government should take. A report previously commissioned by the province found the average policy for a vehicle in 2015 was $1,458 — double that in Quebec and almost 55 per cent higher than the Canadian average.
Ontario has announced plans to set up a “Serious Fraud Office” Vs. the non-serious one?, to combat fraud with a focus on auto insurance.
Article credit: Canadian Press
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