Cheaper Car Insurance Act to Stop Auto Insurance Fraud
A New York senator has presented a proposal for a new federal law that he hopes could rectify an increase in auto insurance fraud. The senator, Chuck Schumer, hopes that the Cheaper Car Insurance Act of 2010 will bring forth new federal penalties to those who commit auto insurance fraud.
About the Cheaper Car Insurance Act
The Cheaper Car Insurance Act will prosecute fraudulent criminals with specific penalties. The criminals will include low-level participants, organizers and insurance fraud masterminds. Also, anyone who accepts money through fraud or stages an auto accident will be charged with a felony.
The act will also include fraud cases cross the state of New York with corresponding fine penalties and jail time. Those who are arrested for fraud will be tried in a federal court and, if found guilty, will be jailed for five to 15 years. Fines could also mount to as much as $100,000.
The Potential Benefits of the Act
The Cheaper Car Insurance Act of 2010 is a response to a recent report that shows an increase in fraud related to car insurance. In particular, the city of New York has seen an increase in fraud cases of 33 percent just in the past four years.
As a result, the area has also seen an increase in auto insurance rates of 6.35 percent. Schumer hopes that with his proposal, all of this can be put to a stop.
Auto insurance fraud is no laughing matter (however, sometimes it can be). If you’re trying to lower your car insurance rates, there are much better ways to go about it than committing a felony.