Car insurance is a mandatory expense for those who want to drive and own their own vehicles. Many drivers never need to use their coverage, as they never cause crashes or get hurt in wrecks caused by other drivers. Some people grow to resent insurance costs. They spend hundreds or thousands of dollars annually on coverage that they never need to use.
In some cases, people may go so far as to fabricate incidents where they file insurance claims. They may even target uninvolved parties to limit suspicion. Some people intentionally stop short in front of others to cause a rear-end crash so that they can replace an aging or damaged vehicle. Others might orchestrate minor collisions with other people and then file an insurance claim seeking coverage for medical expenses, compensation for lost wages and the costs of repairing or replacing a vehicle.
Those accused of filing a fraudulent claim could face very significant consequences. Like others accused of white-collar crimes, they usually have the right to fight back.
Insurance fraud is typically a felony
The state can bring many different charges against those who stage crashes to file insurance claims. New York state statutes make filing a false insurance claim a Class D felony offense. People who plead guilty or get convicted are at risk of a number of significant penalties, with no guarantee of lenient sentencing just for entering a guilty plea. The penalties for a Class D felony include up to three years in prison and $5,000 in fines.
Additionally, if the insurance company pays the claim, there might be grounds for a grand larceny charge in addition to the insurance fraud charge. The prosecutor could bring reckless endangerment charges or conspiracy charges. The courts can also theoretically order defendants to pay restitution in some cases as well.
Contrary to what people might assume, insurance companies don’t simply sign off on large claims. They investigate thoroughly, especially when they believe that a crash may have been intentional or that a claim could have been fraudulent. Factors, including a sudden change in policy to increase coverage immediately before a crash occurs or multiple questionable claims filed over the course of several years, could result in increased scrutiny of a collision and allegations of insurance fraud.
Learning about insurance fraud can help people accused of breaking the law plan an appropriate legal response. A failure to fight back could lead to a life-altering felony conviction for a white-collar criminal offense, leaving a defendant with a permanent criminal record.