Abstract

Faking Car Accidents

Automobiles owners in the U.S. are being victimized daily by racketeers who bring fraudulent accident suits against them. These men and women prey mainly on car owners who carry personal-liability insurance; but the effect of their work is felt by everyone. Rates for automobile-casualty insurance are calculated on the amount of money paid out by insurance companies on claims against car owners insured in that area. Insurance rates in one city will be double those in another if twice as many successful claims are made against insured car owners in the first city as in the second, providing of course, that the average settlements are about equal. This will be true even though the death and accident rates in the second city are far greater than in the first.