The "Insurance Fraud is to blame for high rates" line doesn't hold water.
If that was true - why aren't insurance companies doing something about it - other than passing the cost to us? This arrangement works for them (they are reducing coverage AND increasing rates for everyone, while blaming fraudsters).
Insurance companies are always trying to find ways to prevent and investigate fraud, millions of dollars every year are wasted investigating claims and fraud, it takes months before they get permission from our Canadian legal system to investigate a person/people/companies for fraud, on top of that it takes years before a case is made and people are arrested, things don't happen over night.
As stated in this thread, it could be solved in few really simple steps - have a clause in policy that it is only valid while vehicle is operated by First Last name.
If anyone else is driving - they are driving without insurance. - How easy is that?
It would be great if it was that simple, unfortunately as brokers we heavily rely in the principle of utmost good faith in the answers the insured is giving us, the law will not allow us to do that without a reason. If that clause was imposed on every policy, that would mean: your sister, brother, friend, father, mother, or anyone would not be able to drive your car as they would be driving without insurance, that clause will never happen.
If parents are taking policies and letting their kids drive - why aren't insurance companies doing something/anything about it? They are aware of the problem, it is very costly problem, but instead of introducing simple option, they would rather continue to pass the cost of it onto us... and still blame someone else... This is the complacency of well established racket... Brazen, arrogant thieves acting the way they do - because they are above the law.
Are we to call the person on the phone a liar?? What would be the simple option?? How about people telling the truth, it would be much easier.
Should we investigate every policy, that would mean more millions of dollars wasted, who would pay for it, us the consumer.
Everyone knows how fraud works - from towing to body shops to medical exams/procedures. There's no great mystery here.
There are prolific surveillance technologies these days - start recording these real fraudsters and throw them behind bars - shake up that entire circus and bring some discipline and accountability into that system. Win /Win situation... but insurance companies are not interested in that, status quo works just fine for them.
Blame for this travesty we call Ontario Insurance Act lies flat on insurance companies and politicians they pay off year after year.
It's a constant battle with fraud, surveillance, investigations are going on 24/7, how about people start reporting known fraud to the insurance companies, or even better not being part of it. Unfortunately when there is an opportunity to make a couple of thousand of dollars on a claim everyone jumps aboard.
Example: Subject A, vehicle was broken in during the summer time, calls to make a claim, Subject A has a 13 year old car and a Tenants policy valued at $20,000.
Subject A is claiming his stereo got stolen valued at $1000, leather jacket stolen $1500 and 2 sets of golf clubs valued at $5000
What do you guys think of that, think about for a few seconds and read the next line.
Stereo very possible don't even question it.
Leather jacket, who the heck has a leather jacket during the summer in the car
Golf clubs: His life style does not match the life of someone who can afford $5000 golf clubs, 13 year old car and a tenants policy only valued at $20,000
Proof was required to claim the clubs and jacket, he could not provide proof of purchase or even where he bought the items so the insurance company could investigate, he said he forgot.
I can pretty much tell you if I spent $5000 in golf clubs I would know exactly where I bought it from
He got $1000 minus his deductible for the stereo
The opportunity presented itself and they went for it.