Staged accidents are a growing crime across the country that defrauds car insurance companies and leads to higher auto insurance rates for honest policyholders.

These crooks try to profit from your misfortune, and it all happens in a flash. In some cases, con artists stage accidents using only their own vehicles and a few associates. In others, they target innocent drivers.

Among the tactics noted by the National Insurance Crime Bureau:

When police arrive, the other driver and passengers complain of aches and pains and blame you for the accident. Later, they file thousands of dollars in claims for injuries against your car insurance company.

"Most of the damage is done by groups of people who make their living doing this," says Frank Scafidi, spokesperson for the National Insurance Crime Bureau. "They're knuckleheads, really."

Last year, property insurers referred 28,553 suspicious medical claims to the National Insurance Crime Bureau, a 10 percent increase from 2008. Seventy-one percent of these were personal auto insurance claims.

The bureau projects if the current pace of questionable claims in the first half of 2010 continues, the total will rise 13 percent this year compared to 2009.

Con artists are becoming more sophisticated and organized, says Bob Cline, national special investigative unit manager for Esurance, an online direct-to-consumer insurance company headquartered in San Francisco.

The crooks work with shady clinics and attorneys, use fictitious names and vehicles that can't be traced to previous accidents, and recruit witnesses and passengers with no criminal histories. In many cases, these recruits are recent immigrants unfamiliar with the legal system.

Another trend Cline sees is the growing involvement of street gangs drawn by a lucrative payoff. Until recently, most of the groups that pulled off auto insurance scams were specialists not involved in other criminal activity.

Florida, California, New York, Texas and Illinois are the top five states for questionable medical claims, according to the bureau. The top five cities are New York; Tampa, Fla.; Miami; Los Angeles and Houston.

"Central Florida is the staged accident capital of the country," Cline says.

A 2010 study by the National Insurance Crime Bureau shows the number of insurance claims related to suspected staged or deliberately caused accidents jumped 58 percent in Florida from 2008 to 2009. Tampa is now at the epicenter of the trend, according to the bureau.

Car insurance scammers look for victims who are alone and drive nice cars likely to be well-insured, Scafidi says.

"They're not going to pick on somebody driving a beater," he says.

Seniors and women are more at risk than men and younger people. Cline says crooks also prey on distracted drivers. Some scammers who have pled guilty told investigators they looked for drivers talking on cell phones.

If you're in an accident, trust your gut if anything seems fishy. Report suspicions immediately to your car insurance company.

"Gather as much information as possible when reporting potential instances of fraud, including names and dates, phone numbers, addresses, amount of money involved, documentation and any other information you think is helpful," Loznicka says.

Here are other tips from the bureau to avoid or fight car insurance medical fraud:

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Booster Seats Essential but Rarely Used
While almost all parents use car seats for newborns and toddlers, pre-school age children don't get the same protection – but need it! Each year, almost 500 children ages 4 through 7 die and thousands more are injured in motor vehicle crashes.

According to the Partners for Child Passenger Safety, only 19% of all children 4 to 7 sit in booster seats, which can substantially reduce the risk of death and injury. Of those not in a booster, but using an adult seatbelt, most of these children are too small or short, risking injury or death. In some cases, an adult restraint is more dangerous than none – but barely.

Why Booster Seats?
Booster seats elevate the child up off the vehicle seat to permit better fit with an adult safety belt. A booster can position the lap belt portion of the seat belt across a child's hips securely. A safety belt that's out of position can cause the lap strap to rise over the stomach and the shoulder belt to cut across the neck, leading to possible abdominal or neck injury. And, just as adults do, if the belt is uncomfortable, children will put it behind their backs, defeating the purpose!

Today, forty-two states and the District of Columbia have booster seat laws for toddlers, but only 21 states and DC require booster seats for children ages 4 through 7. Insurance.com supports the recommendations of Advocates for Highway & Auto Safety, an alliance of consumer, health and safety groups and insurance companies and agents working together to make America's roads safer.

What to Do
Pediatricians and other child safety groups recommend that you place children in a rear-facing child seat in a back seat of the car for as long as is appropriate for the seat's height and weight limits. Then put children in a forward-facing child seat in the back seat of the car for as long as is appropriate for the seat's height and weight limits. After that, children should use an appropriate belt-positioning booster seat until they are at least 4'9" and can remain comfortably seated with:

– for the whole trip, on a consistent basis. You can find more resources at the bottom of our article about car seat safety.

Looking for different information? Have questions or feedback? Please let us know.

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If you are heading to the grocery store a couple blocks away – buckle up and put down the phone. Statistics show that driver distraction – engaging in activities that take your concentration away from the road – is one of the main causes of accidents for drivers 18 to 34. In fact, 80 percent of crashes and 65 percent of near-crashes involved some form of driver distraction, according to a 2005 study by the National Highway Traffic Safety Administration (NHTSA) and the Virginia Tech Transportation Institute.

An earlier study by Progressive Insurance showed 77 percent of policyholders involved in an accident were less than 15 miles from home – and more than half were less than five miles from home. High-accident intersections are particularly dangerous – and most cities have a few. If you happen to live in an accident-prone area, insurers will assume your accident risk is higher and charge you accordingly.

You can reduce the risk of accident by avoiding these typical driver distractions:

Cognitive – Lost in thought? Talking on a cell – even hands-free? Then you're not paying attention to the road. Even though you're looking straight ahead, you may not really see what's in front of you. Fatigue can often lead to this type of distraction. If you find yourself spacing out, consider pulling over, getting out of the car for a bit, and refocusing on driving.

Visual – Just leave your copy of “The Cars Greatest Hits” under the passenger seat. Digging for a CD or flipping through a playlist are considered visual distractions. Any task that takes more than a couple seconds to do contributes to a great chance of accident. Taking your eyes off the road to dial a number or text? Not good, either.

Auditory – Hear that siren? Or the horn of the driver trying to warn you that he is out of control and about to careen into your car? No? Then your radio is too loud, you're paying too much attention to your hands-free cell phone or the kids' DVD player is blaring. Loud, consistent noises inside your car can contribute to driver distraction as well. Turn them off or turn them down.

Biomechanical – Need to adjust the seat or your mirrors? Do these things before you are in motion. If you try to adjust a sideview mirror while you're driving, that means you're not looking at the road in front of you. It's a good idea to plug in your car charger before you start driving, too.

It goes without saying that texting or browsing the web on a smartphone or laptop are out of the question. They hit all four of these categories, making them particularly dangerous. That's why so many places have banned cell phone use during driving. It's simply a safety issue.

Six states and the U.S. capital have banned the use of hand-held cell phones while driving. In all but Utah and Washington, D.C., drivers can be ticketed for using cell phones: California, Connecticut, D.C., New Jersey, New York, Utah and Washington. And, in other states, some individual cities have bans.

In 18 states and the U.S. capital, young drivers are either banned or restricted from using cell phones: Arkansas, California, Colorado, Connecticut, Delaware, D.C., Georgia, Illinois, Kentucky, Louisiana, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Rhode Island, Tennessee, Texas, and Virginia.

Texting with is banned in 13 states and the U.S. capital: Alaska, Arkansas, Colorado, California, Connecticut, D.C., Louisiana, Maryland, Minnesota, New Jersey, Tennessee, Utah, Virginia, and Washington.

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In most insurance claims involving auto accidents that are staged, there are no real “victims,” no real pain and suffering. Perpetrators plan the wrecks among themselves, and innocent bystanders usually aren’t involved.

But a recent case in Fargo, N.D., involved more than three dozen real crashes, a number of real victims, and a father-son team who found themselves behind bars after allegedly trying to bilk four auto insurance companies out of more than $70,000.

Sead Mustafic and son Senad Mustafic, both of Fargo, allegedly caused 37 auto accidents from July 2008 to June 2010. More than half involved the father and son closely following an innocent driver and then crashing into that driver’s car as he or she was attempting to change lanes. Many of the drivers told authorities that the lane was clear before the accident. Nevertheless, each of the innocent drivers initially was viewed as the guilty party.

When all was said and done, the Mustafics allegedly had received fraudulent insurance claims totaling $73,697 from the GEICO, Progressive, State Farm and Nodak insurance companies, according to Andrea Fonkert, a spokeswoman for the North Dakota Department of Insurance.

Nationwide, the occurrences of staged auto accidents rose 46 percent from 2007 to 2009, according to the National Insurance Crime Bureau. But North Dakota roads have been virtually free of this kind of fraud. Only eight staged accidents in North Dakota were reported to the bureau from 2007 to 2009, putting it in 45th place among all states in terms of staged accidents.

The insurance companies in the Mustafics’ case didn’t report their suspicions to the National Insurance Crime Bureau because the accidents were fairly typical, says Dale Pittman, a special investigator with the North Dakota Insurance Department’s fraud unit.

The Mustafics may have gone unnoticed if not for Pittman’s efforts. He started working with the North Dakota Insurance Department in December 2009; one of his first cases involved the Mustafics. Actually, the Mustafic case file at that point contained just one piece of paper — a referral from GEICO.

“The report just said it looks like this guy had an accident and added damage to the car afterward with a brick,” Pittman says.

Pittman, a former police chief at the University of Alaska in Anchorage, started poking around and determined that Sead Mustafic was involved in 27 auto accidents and Senad Mustafic in 10 auto accidents, according to the North Dakota Insurance Department.

After some of the accidents, the Mustafics allegedly would cause more damage to their own cars. Eventually, Pittman figured this out.

“These guys were pretty aggressive,” Pittman said. “They’d cause these accidents, get out of the car very irate, get them (the victims) to give them their insurance information and, in some cases, they’d make the other driver sign pieces of paper saying it was their fault.”

The Mustafics were charged in July 2010 with illegally conducting an enterprise, theft of property and insurance fraud. The pair have pleaded not guilty in this case, but they are expected to change their plea to guilty at a court hearing on Jan. 10, 2011, according to the Cass County District Clerk’s Office in North Dakota. Each defendant faces up to 10 years in prison.

–Kevin Lyons

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Yes, you and the driver are legally responsible for the damage to the bus if the driver had your permission to drive the vehicle. If the driver had insurance, his liability policy MAY kick in as primary.

Without question, when you are the victim of an accident, you are faced with a good many personal challenges. Fortunately, we are all required to carry automobile insurance, so at least the at-fault driver's insurance will cover your expenses, right? The short answer is yes, it will...if the driver is following the law and carrying insurance. And if your expenses do not exceed the limits of the other driver's coverage.

The sad fact is that around 15% of the drivers cruising the roads in the state of Georgia are defying the law and driving without any insurance at all. Imagine being laid up with an injury, your car totaled, and finding out that the person who caused the accident was driving without any insurance. Talk about adding insult to injury.

The way that people can protect themselves from uninsured drivers is by carrying uninsured/underinsured motorist coverage on their own insurance policy. A new law, SB 276, contains what is called a "stacking provision." This allows policy holders to "stack" or "piggy back" their own uninsured motorist coverage on top of that of the at-fault party if necessary. In other words, if you are in an accident with a driver who has insufficient insurance to pay for your damages, your own coverage can be added or "stacked" onto theirs to make up the difference. For instance, if they have $25,000 of coverage and your expenses are $100,000, your uninsured/underinsured motorist coverage will make up the $75,000 difference (assuming you purchased this much coverage when you renewed your policy).

It is always a good idea to examine the details of your automobile insurance policy when it is up for renewal. Under this new law you can either elect to get the additional stacked coverage, decline it, or accept the limits of the at-fault driver's coverage. When you consider the fact that some 15% of the drivers that are out on the roads in Georgia have no coverage at all, it may be a good idea to make sure that you have significant uninsured motorist coverage. Being in an injury accident is not a pleasant experience, but being in a wreck due to the negligence of an uninsured motorist can be a nightmare if you do not have adequate uninsured motorist coverage.

If you are the victim on an injury accident in Atlanta, and you have a question about uninsured/under insured motorist coverage and "stacking," call Atlanta Personal Injury Lawyer, Bruce Hagen at (404) 522-7553, or get in touch with him through the website: hagen-law.com. This new law is somewhat complex, so it is advisable to retain an experienced advocate to review your case and be certain that you are getting all of the compensation that is due you in matters that involve SB 276.

Install a car alarm. Though some people may find them troublesome, car alarms are proven to reduce the risk of vehicle theft to an insurance company. This means it is less likely they will have to cash out a claim in the event of a car disappearing in th middle of the night (or day!). To an insurance company, that means that you are a lower risk customer and therefore could potentially benefit from lower premiums each month. While it's true that some car alarms may be fairly expensive you may find that you will have any costs paid back in the near future and savings alone and will actually save (read: EARN) substantial amounts of money in the months to come.

Find a safe place to live. This may seem like a no-brainer, but living in a safe place is better for more things than just your health. As we all know, some areas of cities are more prone to theft and other forms of crime than others. By living in an area that is known for safety and security an insurance company will take this into consideration when deciding your liability as a customer. External influences such as the area in which you live can play a big part in convincing insurance provider that you are out a lower risk of having something happen to your car and therefore they're less likely to have to spend money on a claim of yours.

Get an ugly car. This may sound funny, but it all actuality it can be a real asset to you and your insurance company. Yourself this question: what kind of car would I want to steal if I were a thief? Once you answer that question don't buy that car. The fact is that thieves are more likely to steal certain kinds of cars than they are to steal others. Use this to your advantage and purchase a car that will most likely be low on a thief's radar. Insurance companies will most likely reward this with lower monthly premiums and other benefits to you as a customer. A good place to start looking at is Ezquoteguide.com for various insurance providers that can help you out in your area.

If you're stuck and need some help finding good information online try using Ezquoteguide.com for finding the right local insurance information you need right away to help you fulfill your auto insurance needs.

About the Author:

I focus on saving people money and writing on affordable niches. My primary focus is on affordable insurance. In addition, I have had a passion for affordable dental and medical care.

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