How To Protect Yourself from Staged Accidents and Fraudulent Insurance Claims

How To Protect Yourself from Staged Accidents and Fraudulent Insurance Claims

Establish a driver training program that covers defensive driving, accident response, emergency maneuvers, safe night driving, what to do in a breakdown, and more.

Staged accidents are fraudulent vehicle accident scams where criminals, often targeting commercial vehicles, make the collision appear to be the fault of another motorist to file an insurance claim.

These criminals are actively targeting commercial vehicles because they know the vehicle is well insured and they can claim larger claims against them.

This has become such a big problem that, in 2008, AutoZone decided to remove branding from its light-duty fleet to make them less noticeable as commercial vehicles. This decision reduced accident claims by millions of dollars.

Staged accidents not only affect the targeted carriers but raises insurance rates across the industry.

We will be discussing several topics related to staged accidents and fraudulent claims, including:

  • What the government can do about staged crashes
  • How carriers and drivers can protect themselves from staged accidents
  • Different types of staged accidents

What can the government do about staged crashes?

While staged accidents happen throughout the country, most incidents occur in states with no-fault laws that require insurers to reimburse policyholders for medical expenses regardless of who is at fault.

According to the National Insurance Crime Bureau (NICB), the top five staged accident states are Florida, New York, California, Texas, and Illinois.

The government has taken notice of these issues and a recent house bill would boost protections against staged crashes by cracking down on fraudulent claims, increasing safety on the roads, and helping lower insurance rates for drivers.

Specifically, the bill would:

  • Assure fair and prompt recoveries for highway accident victims with legitimate claims
  • Provide for federal court jurisdiction over interstate cases of national importance
  • Maintain stability in the movement of interstate commerce and protect the public from the safety hazard of staged collisions
  • Provide transparency when litigation finance companies invest in highway accident lawsuits as a profit-making opportunity
  • Protect motor carriers and insurers from the legal financial burdens of defending against, settling, or being found liable for fraudulent claims that result from staged collisions
  • Protect law enforcement agencies from expending resources on the aftermath of staged collisions

American Trucking Associations President Chris Spear supports this bill, “this legislation would restore balance and fairness to the system and help ensure justice drives accident litigation — not profiteering and windfalls.”

But what can drivers and carriers do today to protect themselves from these types of accidents?

How to protect your company and drivers from staged accidents

The best defense against staged accidents is to drive carefully, do not tailgate, and be vigilant of your surroundings. 

This requires carriers to establish a driver training program that covers defensive driving, accident response, emergency maneuvers, safe night driving, know what to do in a breakdown, and more.

With ELD telematic data available to most carriers, companies can also monitor driver behavior and create driver scorecards to encourage positive driver behavior.

These scorecards are point-based starting at 100 points and any selected statistic can remove a certain amount of points based on the severity of the stat you are including in the scorecard. They can be customized further by adding a timeframe duration of the stat or distance traveled.

For example, Pedigree’s ELD driver and safety scorecards include stats, such as:

  • Number of HOS violations
  • Idling greater than 20 minutes
  • Idling percentage
  • Hard Braking events
  • Speeding over 5mph
  • Fuel Efficiency
  • Heavy Acceleration events

Other safety technologies include installing video cameras that attach to a vehicle’s dashboard and records what occurs immediately before an accident.

Carriers should also focus on preventative vehicle maintenance and proper daily pre-trip inspections. It will be harder to establish a strong case if the tires or suspension systems are found to be in violation.

Lastly, following basic breakdown procedures can protect the carrier and drivers from fraudulent claims. Drivers should:

  • Use their phone to immediately take pictures of all damage done to all vehicles, anyone who was in the vehicle, any potential witnesses, and the license plates
  • call the police, even if the damage is minimal, to generate an official police report
  • look for any surrounding surveillance cameras that may have captured additional footage

In the end, if you suspect fraud, you should start the conversation early with your counsel if the accident fits the pattern.

Multiple claims from the same accident, even if they can be settled for small amounts, can have a big adverse impact on your insurance renewal premiums.

It may be worthwhile to investigate rather than look for a quick settlement. 

Types of Staged Accidents

There are patterns to staged accidents that carriers and drivers should be trained to keep an eye out for.

These accidents typically include multiple people in one vehicle who all file medical claims, sideswipe allegations with tractor-trailers, minimal damage to either vehicle, and a tractor-trailer driver who is either unaware of or denies impact.

The NICB identifies six situations where there is a high risk of a staged accident occurring:

  1. T-Bone Accident: In this scenario, a criminal will wait for a company vehicle to proceed through an intersection and then accelerate to T-bone it. When the police arrive, accomplice witnesses, known as “shady helpers,” will claim the company vehicle ran the stop sign or traffic signal.
  2. The Wave: In this fraud, the criminal driver will notice an attempt to switch lanes and subsequently wave the company driver ahead. As the driver maneuvers into the lane, the criminal driver will accelerate, colliding with the fleet vehicle. When the police arrive, the criminal driver will deny giving a courtesy wave to proceed forward and will fault the company driver for the collision.
  3. Dual Turning Lanes Sideswipe: A criminal driver in the outer lane of the dual turning lanes rams or sideswipes the company vehicle while they are simultaneously making the turn.
  4. Swoop and Stop: A criminal vehicle will suddenly pull in front of the company vehicle and abruptly brake to cause a rear-end collision. Another accomplice vehicle will simultaneously pull up alongside the company vehicle, blocking it from swerving to avoid an accident.
  5. Phony Injuries: In any fraudulent accident, your company may find yourself liable for injuries your driver didn’t cause. The criminal and accomplice passengers may collaborate with an unscrupulous physician or chiropractor to file personal injury claims for non-existent injuries. Some criminals visit legitimate doctors and claim whiplash or other difficult to detect soft tissue injuries.
  6. Jump-ins: This occurs when people suddenly appear and jump into the criminal’s vehicle claiming they were passengers.

Need a Commercial Truck Insurance Quote?

The worst situation to be in is getting bad commercial truck insurance coverage and being committed to it for a year when one accident can ruin your business.

We recommend you start a custom quote online or call us directly to speak with a licensed trucking insurance professional.

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