The Cheaper Car Insurance Act of 2010 has recently been passed by US Senator, Charles Schumer, as a means of imposing stiffer penalties on motorists who display fraudulent behavior when an actual claim is made. Once the new laws come into effect, a judge will have the power to impose fines up to a maximum of $100,000. If the total value of fraudulent behavior exceeds the $100,000 cap, the fine will meet the actual amount of the offence.
The new laws will also be bad news to auto-fraud rings that currently drain the industry of millions of dollars each year. With jail terms set to increase to a maximum of 15 years, the ringleaders will be taking on a greater level of risk and if they are caught, their operations will inevitably tumble. Acts of fraud now account for up to 18% of additional premium costs on all auto insurance quotes and, as always, these have to be met by law-abiding citizens.
Auto insurance fraud has risen by almost 33% since 2006 and the exorbitant auto insurance rates applied to road users in New York are amongst the highest in the country. Road users are advised to remain vigilant of illegal behavior relating to auto insurance and to report any suspicions immediately. By operating together, road users and the newly-passed powers stand an excellent chance of ridding the auto insurance industry of this continual menace on a permanent basis. A significant reduction in fraud statistics should lead to cheap auto insurance quotes in a relatively short period of time.