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Auto Repair Facility Fraud


Auto Repair Facility Fraud
​​​​​​​​​​​​​​​​​​​Inflated towing fees and repairs to damages that existed before the insured incident are elements of auto repair facility fraud. Be mindful of repair facilities that take part in fraud.​​​

​​Opportunistic fraud occurs when an auto repair facility exaggerates the cost of a claim with: 

  • Inflated towing and storage fees for services that were never provided, unnecessary or charged at exaggerated rates
  • Repairs for damage that is unrelated to the insured incident​
  • Additional, caused damage to a vehicle to increase repair costs
    Undamaged parts being removed and replaced with damaged parts. The parts are swapped back after the insurance company appraises the damage.

The above schemes may or may not be completed with the knowledge or participation of the vehicle’s owner. In exchange for kickback payments or other auto-related services, a vehicle owner may participate in a fraud.

Premeditated Fraud

After a staged​ or caused collision, members of a criminal ring will make insurance claims for vehicle repairs or services. Vehicle repair facilities may assist in the fraud by billing an insurer for: 

  • Towing services that were not provided
  • Unnecessary storage fees
  • Repairs not done or repairs for damage not caused by the insured collision

A previously salvaged vehicle may be used in a staged collision. Falsified documentation is submitted by approved body shops to the provincial or territorial Ministry of Transportation. The vehicle is subsequently reported to be involved in another collision and the damage is reported as new.