How to Tell You’ve Been in a Staged Accident

There's no sure way to predict when accident fraud might happen, and it's not always easy to tell if you've been targeted or if an accident is staged. To avoid becoming a victim of a staged accident, watch out for suspicious driving behavior, record everything and call the cops and your insurance company as soon as it's safe.

How common are staged accidents?

Staged accidents can be caused by an individual, but it's more often an organized crime activity. Crime rings are responsible for dozens of accidents a year, pocketing millions of dollars from innocent victims. Insurance fraud costs the U.S. an estimated $308.6 billion per year, according to the Coalition Against Insurance Fraud. And the losses due to fraud may be factored into the average cost of insurance for all policyholders, so honest drivers end up footing the bill over the long term.

In a staged accident, the criminals intentionally drive an old vehicle into a stationary object, a conspirator's vehicle or an unsuspecting driver's car and then file a claim for pain and suffering under their auto insurance policy's personal injury protection coverage.

And while the targeted victim is the insurance company, these incidents are also dangerous for all drivers on the road.

Red flags to watch out for

The most harmless form of accident fraud in a no-fault state is when a driver intentionally crashes into a fence or tree and then claims a deer caused them to drive off the road. In these cases, the only witness may be the driver's own passengers, who are in on the scheme. However, scammers may involve other drivers in order to make the accident look more legitimate. You can check for signs that you were the victim of a staged attack by answering these questions.

Did the other driver act strangely?

You pull up to an intersection to make a left-hand turn. The driver coming from the opposite direction signals you to complete your turn but then drives into the corner of your car as you cross the lane. Suddenly, four people stumble out of the vehicle, claiming they had the right-of-way and complaining of neck pain.

Or you might be driving in a traffic circle when another driver suddenly slams on the brakes, causing you to rear-end their car. You've just fallen victim to a fraudulent scenario that has plagued insurance companies for years.

Were you prevented from changing lanes?

Fraudsters may try to make it appear that you were the cause of an accident to ward off suspicion or to file a claim under your insurance policy. A common tactic perpetrators use is to have conspirators in two or three separate cars drive along beside you on the highway, which prevents you from changing lanes. Then, when you appear distracted, the driver in front of you will slam the brakes, causing you to rear-end them — a basic indicator of fault in most states.

Or the other driver might swerve into your lane, claiming to have seen an object in the road or a deer, which can be difficult to prove later.

In addition to the obvious danger of injury, making a claim could cause your premiums to increase. If you happen to be found at fault, despite the accident being staged, your rate might increase as much as 49%.

Were you driving in a wealthy neighborhood?

Staged accidents occur more often in urban, wealthy neighborhoods, where there is an increased chance of both collisions and drivers with newer cars who may be carrying more car insurance coverage, according to the National Insurance Crime Bureau (NICB).

Does the injury claim seem exaggerated?

Scammers will often coordinate with unscrupulous medical practitioners to exaggerate their medical claims, as well as lawyers to sue insurance companies who dispute the claim.

"We have conducted thousands of investigations of staged accident rings, and it's not unusual to find a medical clinic at the center of them," says Frank Scafidi, director of public affairs at the NICB. "These places provide the 'cover' for the fraudulent billing and provision of medical treatments."

Are you a senior or young woman driving alone?

Perpetrators have also been known to target seniors or younger female drivers, especially ones driving alone. Scammers hope these drivers will be easier to intimidate into accepting responsibility for an accident, plus the perpetrators don't want to risk having any other witnesses.

Fraudsters also know young drivers don't want to risk making a claim and seeing their insurance rates rise, making them targets in crash-for-cash schemes.

Do you live in a no-fault state?

While staged accidents occur all across the nation, most incidents take place in states with no-fault laws, such as Florida or Michigan, according to Scafidi.

Scafidi says that is because no-fault laws require insurance companies to reimburse their own policyholders for medical expenses, regardless of who is at fault. While no-fault laws are put in place to benefit average drivers, they can also make quick settlements easier to get for criminals.

How to protect yourself from staged accidents

Get a dashcam. These small video cameras attach to your vehicle's dashboard and are relatively inexpensive — often less than $50. They can record what happens right before an accident or other driving-related incident and help you prove a scammer hit the brakes or didn't have working brake lights.

Document and identify. Use your phone to immediately record or photograph all damage done to the fraudster's car, as well as everyone who was in their vehicle, and record their contact information. This might be enough to prevent them from attempting to make any fraudulent claims against you and will limit their ability to exaggerate injuries or the damage done to their vehicle.

Call the police. You should notify the police whenever you're involved in an accident in which someone claims to be injured. Plus, if you suspect the mishap to be fraudulent, calling the police may also deter the perpetrators, Scafidi suggests. In a non-confrontational manner, tell the others involved in the accident that you're going to call the authorities to get an official report.

Tell the police and your insurance company that you suspect fraud. When the police arrive, communicate your version of the incident to the officer filing the report in private and include your reasons for suspicion. If you truly feel you're being scammed, telling the police probably won't be enough. You'll likely need to explain your case to your insurance company, too.

Watch out for drivers behaving strangely or who look out of place. A driver who is repeatedly circling in a roundabout or waves you to go when they have the right away could be setting you up for a scam. Older cars and cars with dented bumpers or broken taillights are also suspicious.

Don't give the other driver cash or payment. Crash-for-cash scammers want a quick, easy payday, so they might try to convince you to give them money up front. Don't let them scare you into giving them any money, and always go through your car insurance if you suspect fraud.