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Honesty with Auto Insurance Companies

An auto insurance policy is a financial agreement in the classic sense, and a contract of sorts between two parties, the insured and the insurance provider. It is a financial agreement in the sense that in exchange for an agreed upon premium paid by the insured, the insurance company provides coverage that includes compensation for losses in any covered circumstance. When you pay your annual auto premium, you are basically buying assurance that you won't face these sorts of losses without compensation. Of course, insurance is also required by law for virtually all drivers, so it is a legal necessity as well. But as far as coverage and protection are concerned, we have auto insurance because by spending a little, we avoid having to spend a lot if covered loss circumstances.

Car Insurance Can be Abused

Since auto insurance is a commodity buying monetary protection, it is a policy that has some potential for abuse by consumers. But this kind of abuse is something we need to avoid at all costs. The temptation to commit fraud even by just stretching the truth a little bit on a claim can be almost unbearable, especially given the amount of money we spend on these policies and the way money seems to be so tight these days. Overcoming that temptation is important if you hope to maintain a successful and honest business relationship with your provider. After all, as contractual partners we expect our insurer to be honest and fair with us. We want good treatment and we have every right to expect it. But our insurance companies in return have every right to expect the same from us. If they are expected to provide a certain level of service in return for our premiums paid, they should be able to count on us to do our part as well and to keep the relationship on an even keel in the things we do as consumers.

The temptation for auto insurance abuse can be great, of course. The potential for monetary gain alone is reason enough for this action to be very tempting indeed. Getting paid for a questionable claim can bring back all the premiums we have paid and then some. Many people fall into this temptation for various reasons. Some of them are honest people at heart who have for some reason talked themselves into this kind of scheme. They tell themselves that with all the money they have paid into their policies over the years, they deserve to make a draw upon them at one time or another. This is the outlook that thinks of car insurance as a savings account. We figure that if we put money into that account, we should be able to expect to draw from it as well. This logic is hard to refute until you think of insurance the way it really is.

Insurance a Back up Plan

Auto policies are not like bank accounts in which we can expect to make a withdrawal from time to time. In fact, as a general rule you should try to avoid claims to keep your rates low over time. They are more like a back up plan or a rainy day fund for when you absolutely need it. They are not like the gas in your car that you plan to use as soon as you fill up. They're more like the airbag that you hope never to have to use, but are glad it's there when you do need it.

Lying to Auto Insurance Providers

Policy holders generally lie to providers in one of two ways. One is in their policy application itself. Falsifying an application to try to save money is a crime, but it is something many motorists try to get away with anyway. People can get so caught up in the chase for monetary savings that they lose sight of simple right and wrong. Fudging answers on policy applications regarding age, specifications of the car being insured, and even their home address can sometimes bring short term gain, but in the end, these decisions often lead to dire consequences.

The other way car insurance consumers often are dishonest with providers is in the area of claims. Dishonest or misleading claims are common enough that certain specialists in the employ of auto insurance companies spend all their working careers trying to detect and root out these false claims. In certain pockets of the country especially, auto insurance fraud has risen sharply in recent years, with swoop and squat stages accidents and other techniques on the rise as fraudulent claim practices. But even if there is a potential monetary windfall available for participating in such activities, the risks of taking part do not sufficiently justify those possible financial rewards versus simply displaying honesty with insurance companies.


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