Auto Insurance Fraud Is on the Rise. Here’s What to Look For

It’s never fun to get into an auto accident. But if you discover you’re the victim of a staged accident — a purposeful crash used to commit auto insurance fraud — chances are it feels just a little worse.

And unfortunately, according to reporting by Fox Business, such accidents are on the rise.

In fact, one such crash, which occurred in October on New York City’s Belt Parkway, went viral on TikTok. The dashcam footage shows a silver Honda abruptly swerving into the left lane in front of driver Ashpia Natasha, slowing to a confusing stop before putting the car in reverse and slamming their rear bumper into the front of Natasha’s vehicle. The Honda’s passengers got out of the car and claimed they’d been injured.

Mark Friedlander, a spokesperson for the Insurance Information Institute, told Fox Business that industry analysis shows a 14% increase in such accidents in New York specifically between 2022 and 2023. New Jersey had it even worse at 58%.

How staged accidents affect insurance

According to Friedlander, staged accidents for the purpose of auto insurance fraud are "nothing new" — "but we're seeing an uptick in many areas."

And such scams don’t just affect drivers unfortunate enough to be targeted.

An increase in fraudulent auto insurance claims can shift insurance companies’ risk-calculating algorithm, causing car insurance to become more expensive for everyone. (In 2024, the average cost of car insurance is $767 per year for a minimum-coverage policy, and consumers have seen rate increases averaging 29% over the five year period of 2019 to 2024.)

Of course, it’s even worse for those involved in staged accidents. Along with their car getting crunched up, they could be injured or worse — and if they’re not using a dash cam, it can be hard to prove fraudulent intent.

Filing claims with your auto insurance company can cause your premiums to rise, even if you’re not officially at fault for damages. And if you file too many claims, your insurer could drop you altogether — again, even if you’re not at fault.

Keeping an eye out for staged accidents

Unless you keep off the roads, it’s impossible to avoid the risk of staged accident auto insurance fraud entirely. But there are some red flags to look out for and scenarios to avoid.

For starters, Friedlander mentions that staged accidents are most common "on interstates in highly populated, highly congested areas of the country" — so if you’re in a city like New York, consider taking public transit instead. Wealthy neighborhoods may also be likelier targets, since fraudsters may think it more likely that drivers in the area are carrying higher car insurance coverage.

Senior drivers and young women driving solo might be seen as more easily intimidated — and thus more likely to take fault for a staged accident. Tailgating may also make it easier for a fraudster to purposefully slam on their brakes and cause a crash.

If you’ve already been in an accident, signs it might be staged include seemingly overblown injury claims or confounding driving behavior. No matter what, call both the police and your insurance company as soon as it’s safe to do so — and get as many pictures and videos of damages to both vehicles and all occupants as possible.