PIP insurance stands for Personal Injury Protection insurance. In Florida,
PIP coverage pays out claims of up to $10,000 in medical expenses and lost
wages for each person in a vehicle injured in an accident. Regardless
of fault, motorists are required to access the first $10,000 in accident-related
costs from their own insurance benefits. Unfortunately, fraudsters often
exploit these payouts. Criminals may work alone or as part of organized,
elaborate schemes to stage
auto accidents and then bill insurance companies for exaggerated or fraudulent injuries.
The Two Most Common PIP Fraud Scenarios and How to Avoid Them
For many years, organized groups in southern Florida have conspired to
fraudulently obtain PIP benefits. Coordinated
fraud schemes typically involve several parties and can be considerably complex. In
many cases, one or more drivers will target an innocent motorist to make
an accident seem a bit more plausible.
Staged Accidents: Two or more fraudsters, driving in separate vehicles, may target an innocent,
unknowing motorist. One car will pull in front of the “target”
driver while the other pulls alongside in the adjacent lane. Without warning,
the car in front will slam on the brakes and cause a rear-end collision.
If the driver swerves to avoid the rear-end collision, he/she will either
be forced to swerve completely off the road or will swerve into the other
driver in the adjacent lane. In most cases, the unknowing motorist crashes
into one of the fraudsters’ cars. The fraudster will immediately
pursue a PIP payout, regardless of if he/she is truly injured.
How to avoid it: Maintain a safe following distance at all times. Even in busy, stop-and-go
traffic, accelerate slowly and follow with caution. If another car pulls
in front of you and slows down, you should maintain a slow interval. If
the car slows down suddenly or acts suspicious, back off or attempt to
pass. If you cannot pass and must slow down considerably, turn on your
hazard lights and keep a safe distance.
If possible, pull off the road into a parking lot for a few seconds. Fraudsters
are seeking impatient drivers who will ride up close behind the lead-fraud
vehicle and will be unable to stop in time to avoid the collision. If
you are hesitant and exercise caution, it is likely that fraudsters who
may be targeting you will abandon their efforts and will move on. They
are unlikely to stage an accident with a driver who is already suspicious
and working to avoid them.
Falsified Clinical Records: Sometimes, corrupt medical practitioners participate with the drivers
described in Case 1. However, fraud is more prevalent among cases in which
shady medical practitioners approach innocent drivers who have been in
accidents and agree to pay them for using their accident to stage a claim.
Low-income drivers are often targeted by corrupt clinicians. They actively
recruit drivers by paying them a cut of the $10,000 benefit. These practitioners
fabricate a false or exaggerated medical record and treatment plan and
file for the full $10,000 benefit, even though the actual cost of treating
the injury may be less than $100. A treatment plan never takes place,
but benefits payouts are collected by these “accident clinics”
and a portion of the cash is given to the driver. In September, two owners
of an unlicensed chiropractic office based in Miami were arrested for
How to avoid it: Cooperating with one of these medical practitioners is insurance fraud.
Drivers should never consider this, as those caught can face stiff penalties
including jail sentences. Be leery of any unsolicited offers for treatment
you receive following an accident. Only receive treatment at legitimate
medical offices registered with the state. Select a physician at random
and research him/her online. You can start out by using only offices operated
by licensed medical doctors. Not all, but many of the fraudulent clinics
are run by chiropractors or massage therapists and the majority of MDs
will not associate with these types of organizations.
Insurance Journal News
Online Sunshine (Legislature)
Florida PIP Fraud News