Don’t Fall Prey To Pip Fraud

Don’t Fall Prey To Pip Fraud

November 27, 2020 Off By Glespynorson

Staged accidents, patient brokering, fabricating or exaggerating injuries, “runners,” and cappers all have one thing in common – Personal Injury Protection (PIP) insurance fraud.

The no fault auto insurance imposed on drivers by Florida Legislature in the 1970s provides injured drivers up to $10,00 in immediate medical coverage, regardless of who caused the accident.

This, in turn, saw the rise of organized crime rings specializing in PIP fraud. With the National Insurance Crime Bureau reporting a 102% increase in suspected staged accidents between 2008 and 2011.

To try and stem the tide of criminal activity in 2013, Florida passed a new set of stringent Personal Injury Protection laws, which has gone a long way to curbing PIP fraud. Current figures in 2019 paint a different picture to that of 2013, with 8457 auto-related cases of fraud in Florida.

What Is Personal Injury Protection Insurance?

The intention behind the personal injury protection (no fault) auto insurance was to provide injured drivers with up to $10,000 in immediate medical coverage in lieu of establishing fault through the court system. In essence, PIP coverage makes the individual responsible for their injuries in an accident regardless of fault.

Coverage Provided By PIP

Here are the 4 main coverages of Personal Injury Protection insurance.

Medical Bills

Up to 80% of medical costs are covered. You have to report your injuries within 14 days of the accident and be treated in an emergency setting. Suppose you are not diagnosed with an Emergency Medical Condition, in that case, the PIP limit is $2,500 instead of $10,000.

Select medical practitioners, such as Chiropractors will make use of services such as EMC Florida to streamline the claims process for them and the patient.

Lost Wages

Up to 60% coverage if you are unable to work due to accident injuries.

Replacement Services

Up to 100% if an accident puts you in a position of being unable to do things for yourself or your family.


In the event of death, an amount of $5,000 for funeral expenses and survivor benefits pays out.

Is PIP Coverage Just for You?

No, personal injury protection insurance covers your children. It provides coverage for them in your vehicle and also when they take the school bus.

Be Wise to The Ways of PIP Fraud

So, what are the mechanisms at play behind PIP fraud? Here insurance industry experts have identified some of the more common scams in use:

The Staged Accident  

A group of participants usually orchestrates them. The leader is known as the ‘capper’ and often serves as the director of the accident. They use people willing to participate for a fee to drive a ‘bullet’ car and a target car. The bullet car will strike the target car, with the occupants of the target car claiming for injuries.

The Wave Down

In this instance, a motorist is encouraged to pull into traffic from a side street or parking lot only to be struck when the bullet car accelerates.

The Swoop and Squat

Here two vehicles working in conjunction with one another put an innocent motorist into a situation to force a rear-end collision.

The Unsuspecting Target

You are involved in an accident, and your car gets towed. Your personal information is obtained by someone called a “runner” who contacts you and offers to help you get treatment. If you tell them you’re not injured, the caller may offer you a cash payment to visit a specific clinic or medical center.

How to Protect Yourself from a Staged Accident

It pays to be wary in more ways than one when you’re on the road. Don’t fall victim to a staged accident by adopting these 3 tips:

Do Not Tailgate

If you are guilty of doing this, remember you are easy prey for a criminal. As they are more likely to dart in front of you quickly and slam on their brakes, causing you to rear-end them.

Know Your Tow Driver

If you did not summon a tow driver to your accident scene and one turns up, do not turn your vehicle over to them. Go with a company you can trust.

Call the Police.

Getting the police involved no matter what the extent of the damage is a wise move. They can document the accident and ultimately provide you with protection from fraudsters lurking at the scene.

The Bottom Line on PIP Fraud

In short, criminal activities surrounding PIP fraud has led to an increase in Florida’s auto insurance rates. In a study conducted by Insure in 2020, Florida claimed the third spot as the most expansive state for car insurance. Some 48% higher than the 2020 national average.

And one of the significant contributors to these statistics was PIP fraud, which raised rates for all by some $250 a year.