Cash for crash insurance scamming brothers jailed

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The men behind what has been described as the biggest cash for crash scam in Britain have been jailed for a total of 11 years between them. Brothers, Rezwan and Rehan Javed were found guilty of conspiracy to defraud and possession of an article for use in fraud at an earlier trial. Rezwan received a jail sentence of 6 years, while his older brother Rehan was jailed for 5 years.

It is understood that the duo paid drivers to drive around roundabouts and brake suddenly, causing the driver behind to smash into the rear of the car. The brothers would then make numerous claims from the insurance company, falsely claiming for vehicle write-offs, and for personal injury claims for at least three passengers travelling in the vehicle which was hit, netting £3,000 in compensation per passenger.

It’s been reported that the two brothers made almost a £1 million pounds through their cash for crash scams. The pair ran a company which took a cut from the solicitors referral fees, courtesy car hire and storage and recovery of the vehicles.

The two brothers were found guilty of defrauding the insurance companies at their trial at Manchester Crown court last week. In 2008 another member of the gang, Mohammed Patel, run by the Javed brothers was jailed after he admitted being the driver in over 90 cash for crash collisions.

Ban on injury claim referrals could lead to drop in cost of car insurance

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The government has revealed plans to investigate and possibly seek a ban on referral fees for personal injury claims in an attempt to curb the rising cost of car insurance.

Year on year annual car insurance premiums have been rising at a rate of as much a 40% every 12 months. The Office of Fair Trading (OFT) has revealed plans to investigate car insurance in the UK with this in mind, and will reveal their findings in December. If they find the industry has been operating in a non competitive way, further action will be taken by the official body.

The most interesting development on late is the government’s plans to tackle referral costs which it feels is having a direct effect on the rising cost of car insurance. Often motorists who have been involved in an accident are encouraged to make a claim on a “no win no fee” basis. The claim is then passed between a management company, insurance company and lawyer who charge each other for the claim referral, with the lawyers recovering their costs from the losing defendant. The upshot being that honest motorists are being hit with higher premiums to cover the cost of the high number of personal injury claims being made.

If the government is successful in their bid to put a stop to “no win no fee” claims, this is likely to lead to a decrease in the number of personal injury claims being made, helping to put an end to the compensation culture and the year on year increases in the cost of car insurance.

Online petition to protest over rising cost of car insurance in Yorkshire

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An online petition set up by a Yorkshire MP is calling for a reduction in the huge car insurance premiums being quoted to drivers in the area, and young drivers especially, after one 20-year-old driver in the Bradford East area received a quote of £50,000 for an annual car insurance policy.

The online petition has been launched by the MP for Bradford East, David Ward, whose constituency sees some the highest car insurance rates in the country. The issue of rising car insurance costs isn’t just isolated to young drivers either as the MP has described instances in which drivers with a 30 year driving history with no claims have struggled to find affordable cover simply because of where they live.

David Ward has described being inundated with complaints from his constituents over the spiralling cost of car insurance in the Bradford area. A rise in the number of fraudulent claims and crash for cash scams in this area of Yorkshire has been blamed for the increase in the cost of cover for responsible drivers.

For MP David Ward, something had to be done, and so the online petition has been established. So far the petition protesting over inflated car insurance quotes has gathered over 150 signatures. The MP plans to present the petition to the Department of Transport and is also considering raising the issue in the House of Commons.

Rear end crashes are leading to higher car insurance premiums

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Over the course of the last year research conducted by insurance provider Admiral has found that rear end bumps have risen by 9% which is having a knock on effect on the cost of motoring insurance.

The car insurance provider believes there are two main reason behind the escalating number of rear end accidents, the first being crash for cash fraudsters who deliberately slam on their brakes causing the person behind to run into them, and the second cause of rising rear ending crashes is road congestion say Admiral. With 33 million cars using UK roads every day, roads are busier leading to more queuing traffic which can result in more rear end accidents.

Tailgating and speeding are also factors which lead to rear end crashes, according to car insurance provider Admiral.

The cost of personal injury claims for whiplash alone following a rear end bump over the course of 2010 was estimated at £1.9 billion while the cost of fraud is thought to have cost the insurance industry a whopping £3 billion during the last year. Not surprisingly, these massive claims are having a negative effect on the premiums of honest policy holders as the losses from the insurance company are passed onto the consumer through increased car insurance prices.

More needs to be done to tackle car insurance scams warn MPs

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A report conducted by the House of Commons Transport Committee has urged the insurance industry to do more to help reduce the number of bogus insurance claims being made, and so help stem the rise of personal injury claims which is adding extra cost onto insurance premiums year on year.

The MPs report recommended that the insurance industry funds a dedicated police unit to tackle cash for crash scams which are reported to be on the increase. The introduction of a police unit concentrating on combating this kind of crime would have a dramatic impact on reducing the number of illegal claims and staged accidents which are happening across the country, the report suggested.

The House of Commons report also urged the Government to make changes to the driving test to ensure only those with very good driving ability passed in order to reduce the number of serious accidents in which young drivers are involved in every year.

The rise in personal injury claims after a car accident were blamed on insurance company’s practice of receiving a referral fee from lawyers specialising in personal injury for putting them in touch with potential clients. The report found that 40% of insurance companies work in this way. However the Insurance companies blame the “compensation culture” in Britain for the rise in personal injury claims.

Car insurance scammers on the rise

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Car insurance scammers who stage accidents in order to claim money off the innocent party’s policy are on the rise, according to recent statistics.

It’s been estimated that these “cash for crash” fraudsters cost the insurance industry £350 million last year, adding an extra £44 to the cost of each UK motorist’s car insurance policy.

The most common technique employed by these fraudsters is to cause a situation whereby the innocent driver behind them, crashes into the back of their vehicle. It’s generally accepted that the driver who rear-ends another vehicle is in the wrong.

The scammers often set up these “accidents” on clear roads, or at roundabouts. Another trick they use to lead the victim into rear ending their vehicle is to slam on their handbrake so the driver behind won’t be alerted to the fact that the vehicle in front is stopping from the brake lights.

Victims are not chosen at random, instead the scammers single out elderly drivers, and lone parents, as they are less likely to fight the insurance claim. Commercial drivers are also a favourite with the fraudsters as they are less concerned about the damage as their vehicles are owned by their company.

The average amount obtained from each claim was approximately £17,000. This amount includes costs for personal injury, and also the damage to and recovery of the vehicle.