Insurance crime TIPS line (1-877-IBC-TIPS) launched

Canada’s insurers have launched a national insurance crime TIPS line to make it easier for Canadians to report auto theft, insurance fraud, staged auto collisions and other crimes related to insurance.
As a result of an anonymous tip that listed, the Insurance Bureau of Canada (IBC), the administrator of the new TIPS line, recently foiled a $1 million insurance scam. This scheme involved about 1,800 policies and potentially cost innocent policyholders more than $1 million.
Subsequent IBC investigations stemming from the tip that listed names of individuals whose insurance applications allegedly contained false information, uncovered a scheme involving more than 22 Ontario businesses, including several car dealerships.
Individuals were offering potential customers discounts on auto insurance – in some cases as an incentive to buy a car – and were making customers pay a one-time up-front fee of $300-600.
The individuals would then acquire insurance on the customers’ behalf, using bogus information to get lower rates.
Authorities are now investigating the individuals involved. The 1,800 victims have lost the $300-600 up-front, discounted fee they were expecting.
“Unbeknownst to the victims, their applications contained false information,” Rick Dubin, vice-president, Investigations, IBC, says. “Had any of them made claims, this could have bogged down the claims process unnecessarily. As innocent victims of this scheme, it’s most likely that they would be covered in the end, but it would take time to sort out the discrepancies on the forms.”
Insurance crime costs insurance companies and policyholders approximately $3 billion a year. This is a conservative estimate. Furthermore, far from being victimless, insurance crimes like auto theft cost lives.
Every year in Canada, 20-30 people lose their lives as the result of car thieves trying to evade the authorities; often driving too fast, while under the influence of drugs or alcohol, and showing no regard for the safety of others.
“Most people know that stealing a car or setting fire to a house is a crime,” Dubin says, “but they may not know that lying on an insurance application, exaggerating a claim or faking a car accident are also serious crimes.”
Dubin explains the importance of the public’s role in calling the national insurance crime TIPS line if they have suspicions that someone is involved in insurance crime.
“When you submit a tip, IBC will work with its member companies and the authorities to make sure the wrongdoers are brought to justice,” he adds.
The public can reach the toll-free TIPS line at 1-877-IBC-TIPS (422-8477) or submit a tip on-line at www.ibc.ca. All tips are kept confidential.