Could Dash-Cams Cut Fraudulent Car Insurance Claims?
Sales of in-car video recorders, (dash-cams) are rising quickly as motorists take the initiative in collecting accurate information about an accident. Bogus car insurance claims cost the insurance industry as much as £2 billion, driving up premiums. Dash-cams can help drivers to fight back.
Dash-cams can establish quickly who was at fault in an accident. For example, in fake “crash-for-cash” crimes, criminals deliberately cause an accident by braking suddenly, causing the driver behind to crash into them. They often claim tens of thousands of pounds for car damage and fake whiplash injury compensation.
A number of attempted fake claims have already been successfully thwarted by dash-cam recordings, including the remarkable incident below. The video shows a young man run his moped backwards into a stationary car. He then throws himself onto the bonnet and tumbles to the ground. An apparent accomplice is nearby to film him on the ground, as if in the aftermath of the “crash”. When the shocked car driver tells them both her dash-cam has recorded the whole event, both young people run away.
Should dash-cams be compulsory?
Research carried out by the RAC shows that 71% of UK drivers believe in-car cameras would help cut bogus car insurance claims. 26% go further, saying they should be compulsory.
Pete Williams, RAC’s Head on External Affairs, said, “As long as they are used correctly, dashboard cameras are a valuable record of the circumstances that occurred around an accident and as such can help to reduce the cost of personal injury claims which, in turn, should ultimately reduce the cost of insurance. Making in-car cameras compulsory would come at a cost initially, but they could pay for themselves in the long run if they cut the nation’s premiums.”
It’s completely voluntary for drivers to fit dash-cams at the moment, but an estimated 4% of motorists already have one. When asked, 39% of drivers said they were considering fitting one.
Concerns over privacy issues
If every car journey recorded continuous loops of video footage, the amount of public data collected would be huge. This has consequently raised concerns over privacy issues. As an example, Austria bans dash-cams; furthermore, it’s illegal to leave any surveillance equipment switched on and unattended in Sweden.
Any serious move by insurance companies to make video recorders in vehicles a compulsory requirement would face tough arguments from privacy campaigners. These are unlikely to be resolved quickly.
Who would benefit most from installing a dash-cam?
Any driver can fall victim to a fraudulent insurance scam. Even genuine accidents would benefit from an accurate record of what happened. However, drivers with higher mileage might find it especially useful to fit a dash-cam to their vehicle. Couriers, taxi drivers and hauliers, spending many hours on the road each day, may all benefit from using this type of device.
Young drivers could also benefit from the extra evidence provided by a video recorder. Together with the data fed back to insurers via black box devices, a dash-cam could help give insurance companies a better all-round picture of a driver’s behaviour.
Cutting insurance premiums
Video evidence can speed up the whole insurance claims process by quickly establishing who was at fault in an accident. This alone would save insurance companies time and money in investigations, negotiating settlements and court costs.
Cutting down on fraudulent claims ultimately reduces costs for the insurance industry as a whole. Thus, policyholders could have savings passed on as reduced premiums.
Insure Your Motor feels that the growth in popularity of in-car video recorders will have a positive effect on car insurance claims. Motorists already using dash-cams are showing a responsible attitude to driving. This benefits everyone in the long-term, as the industry drives out fraud and drives down premiums.