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.
The confusing thing is that there is actually no logical or even physical correlation between the increased write-offs and accidents with the slow economic times. On the surface of things it would seem that this is purely a random coincidence at best. However after much prying and research insurance companies have determined that it is actually due to the despicable actions of a few car insurance policy holders.
The unfortunate truth is that many people who are in financial distress do turn to less than appropriate methods to try settle their dues. Some people turn to taking advantage of insurance companies and other criminal acts just to get by in these distressing financial times. Although it is despicable it is a reality that we all have to accept this and plan forward.
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.
Other more daring individuals will even dismantle their cars and sell their car parts to wreckers for extra money while reporting that their cars have been stolen. It is very obvious that these criminal acts are against the law and should you be found-out all your claims will be voided by the insurance company. The fact is that there simply isn't a point in time where you should ever turn to insurance fraud to get rid of you car. There are far better ways to deal with it without going against the law.
Often times, if you find that either financing your car or paying you car insurance is simply too much for you to handle for the moment then you should simply get rid of the car the legitimate way, sell it! If the car is under finance then you can slowly pay back the remaining of the loan and even restructure it to fit your cash flow requirements if needed. Never resort to crimes such as making false car insurance claims just to get your help your cash flow or get rid your car. The risks are simply too large for the potential pay-off.
Although you may not think that this affects you as an honest car insurance holder, it actually does. Insurance companies do not have the ability to define who is likely to conduct insurance fraud and who isn't. Instead they will simply raise the risk profiles for all their customers so that they will not see a loss should it happen. The end result is that premium rates for all customers will be increased. There is no way to get around this as every insurer will cover themselves against this risk. Basically every policyholder will effectively be penalized for the action of a few irresponsible few.
The net affect of this is that premiums will go up, even if you have been the best car insurance customer around, prompt with premium payments and never claiming a thing, you too will be affected by this trend. There really isn't anything that you can do about it other than to understand why there might be an increase in premiums in these recessionary periods.
The confusing thing is that there is actually no logical or even physical correlation between the increased write-offs and accidents with the slow economic times. On the surface of things it would seem that this is purely a random coincidence at best. However after much prying and research insurance companies have determined that it is actually due to the despicable actions of a few car insurance policy holders.
The unfortunate truth is that many people who are in financial distress do turn to less than appropriate methods to try settle their dues. Some people turn to taking advantage of insurance companies and other criminal acts just to get by in these distressing financial times. Although it is despicable it is a reality that we all have to accept this and plan forward.
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.
Other more daring individuals will even dismantle their cars and sell their car parts to wreckers for extra money while reporting that their cars have been stolen. It is very obvious that these criminal acts are against the law and should you be found-out all your claims will be voided by the insurance company. The fact is that there simply isn't a point in time where you should ever turn to insurance fraud to get rid of you car. There are far better ways to deal with it without going against the law.
Often times, if you find that either financing your car or paying you car insurance is simply too much for you to handle for the moment then you should simply get rid of the car the legitimate way, sell it! If the car is under finance then you can slowly pay back the remaining of the loan and even restructure it to fit your cash flow requirements if needed. Never resort to crimes such as making false car insurance claims just to get your help your cash flow or get rid your car. The risks are simply too large for the potential pay-off.
Although you may not think that this affects you as an honest car insurance holder, it actually does. Insurance companies do not have the ability to define who is likely to conduct insurance fraud and who isn't. Instead they will simply raise the risk profiles for all their customers so that they will not see a loss should it happen. The end result is that premium rates for all customers will be increased. There is no way to get around this as every insurer will cover themselves against this risk. Basically every policyholder will effectively be penalized for the action of a few irresponsible few.
The net affect of this is that premiums will go up, even if you have been the best car insurance customer around, prompt with premium payments and never claiming a thing, you too will be affected by this trend. There really isn't anything that you can do about it other than to understand why there might be an increase in premiums in these recessionary periods.
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