Consumer Alert: NYS crime of “staged car crashes” is costly and on the rise

Criminals are costing the average New York driver $300 a year in premiums

From the, EMPIRE REPORT NEW YORK 2025®

NEW YORK – Citizens for Affordable Rates (CAR) today issued a consumer warning urging New York drivers to be vigilant against staged car crashes – criminal networks that are a major driver of the state’s skyrocketing auto insurance costs. The warning accompanies a new fact sheet detailing how these schemes operate and their impact on every driver’s wallet.

“Staged car crashes are not a victimless crime,” said CAR spokesperson James Freedland. “They’re organized networks that prey on unsuspecting drivers and force law-abiding New Yorkers to pay higher auto premiums. We’re issuing this warning so consumers can protect themselves in this affordability crisis — and to urge Albany lawmakers to take action before insurance costs skyrocket even further.”

How the Scams Work:

• Crash-for-Cash Schemes: Tactics like “brake slamming” and “swoop and squat” are used to cause collisions.
• Medical Mills: Fraudulent clinics submit inflated medical bills, sometimes exceeding $50,000 per staged accident.
• Sham Lawsuits: Shady attorneys file lawsuits to extract costly settlements from insurers – and ultimately, consumers.
• Fraud Rings: Vulnerable individuals are recruited to participate in staged crashes, while ringleaders profit.

Key Facts:

• Staged crashes and inflated medical claims account for 75% of all insurance fraud cases in New York (NYS Department of Financial Services), adding an estimated $300 per driver per year.
• New York is an Unaffordable Hotspot: New Yorkers pay $4,031 annually for full coverage – nearly 40% above the national average. 5.2 million residents live in areas where coverage is unaffordable, and 11% of drivers go uninsured.
• New York’s no-fault law requires insurers to pay medical claims within 30 days, giving fraudsters a window to exploit the system before investigations can occur.

The Human Impact:

• Rising premiums force families to cut back on essentials.
• Small businesses and workers face higher transportation costs.
• Increased uninsured driving contributes to more hit-and-run accidents, putting everyone at risk.

Governor Hochul can protect New Yorkers by:

• Extending the investigation period for suspicious claims.
• Cracking down on fraudulent medical clinics and abusive lawsuits.
• Strengthening penalties for organized fraud rings.
• Creating specialized prosecution units focused on staged accident cases.