Buying insurance AFTER a vehicle was stolen / in an accident?

Question

We all know that collision and comprehensive coverages demand high premiums these days. I also know that if your vehicle is financed and you don't provide a lender with adequate insurance or your insurance is expired or whatever, such lenders can insure the collateral themselves, EVEN AFTER a loss has occured - theft, accident, fire, etc.
My question is: Why couldn't I do the same? That is, wait for an accident to happen or your vehicle to be stolen, AND THEN purchase insurance, wait a period of time, and file a claim.
I realize that you'd have a hard time proving an accident occured while your policy was active; police probably need to make an on site report, appraisers can detect the age of the damage and other shortcomings. But what about THEFT? If your vehicle is stolen and you do not file a police report, then buy coverage, wait some time, report the theft as it just happened and then file a claim? What are your chances?
I'd appreciate pragmatic responses, w/o ethical aroma.

When I say "wait some time", I mean several months; but at least 2 or 3.

Answer 1

Insurance fraud can and is committed. More often than most people would believe. However, insurance companies are not dumb. They have teams of investigators that review these claims. There are databases of information regarding every claim that is filed. You might get away with it once or even twice. Your name would start appearing on a watch list. And eventually something would happen that would cause you to get busted.

Answer 2

2

Answer 3

Well, the lenders have a "blanket policy" in place, it ONLY covers the amount of the loan.

Every month, they send in a "reporting form" to list the vehicles they want covered. That's kind of deceptive, because they have until 45 days AFTER the last day of the month, to get the list in to their insurer.

Anyway. You can't do the same, because you don't have access to a personal "reporting form". Ford Credit, for example, will have approximately 100,000 cars insured in any given month (at about 10X the cost, btw, each, of YOUR collision coverage). The only question is, which 100,000.

So they pay MASSIVE premiums (which they divide up and pass along to the lendee), and part of the privledge of doing that lets them have some time flexibility with notifying teh company.

If YOU Paid hundreds of thousands of dollars a month for insurance, you could do it, too. The thing is, the insurance company needs to take in more than it pays out, or it goes out of business.

So when you're talking about insuring 100,000 cars, at $100 a pop for a month, and ONLY paying off the loan balance, the insurance company can afford to pay a couple loan balances for the 5 - 10 cars that get added on with the next month's reporting form, and still make money. ESPECIALLY because, the owner of the car is still on the hook for the full loan amount!! It is STILL collectable, even if the loan was paid off by another insurer.

Answer 4

If you already have an insured vehl and this is a newly acquired car then you would be covered as if this were a temp or substitute vehl. You would have to have comp on your current vehl. There is a grace period between the time of your purchase of a new vehl and the time you need to report it to your insurance company.

If that is not the case and you didn't have any policies in force and you simply bought a vehl (most of the time they make you prove insurance before you drive it off the lot) and didn't have any coverage anywhere you would be looking at fraud. You may also have some sort of a grace period depending on the state that you live in to a newly acquired car.

Answer 5

Well you would be committing a crime but its a very common one that people do get away with. The insurance company will grill you when they send out their rep, so if you can keep a straight face then you might get away with it too.

I know someone who backed into a tree by accident, then parked her car in a WalMart parking lot and called the police and lied that it was damaged in the lot, filled out the police report and got her insurance money.

If I was the adjuster I'd clearly want to know why you purchased the car X months or years ago, then waited to get insurance, then got it stolen X days later...but hey, it might work.

Answer 6

too risky. you have a vehicle, it gets stolen on Monday January 1st. You buy coverage on January 2nd and then claim the car was stolen on January 10th in hopes of collecting the insurance money.
HOWEVER ....
when you purchase the insurance on the 2nd, you are attesting that you have the vehicle in your possession. Since you don't,. you have lied - in this case, it's called "insurance fraud" and you will go to jail
AND THEN ....
when you file a stolen vehicle report on the 10th, one of the questions the cops will ask is "when did you last drive the car/see the car?" You will have to lie about the dates, which in this case will be called "filing a false police report" ... a thing that policemen seem to frown on. They probably can;t send you to jail for this, but it certainly will help the insurance company in their fraud case against you.
SO ....
I guess you would have a chance of pulling this off, but the risks - jail time and huge fines - are too great in relation to the small amount of insurance $$ you would get by scamming the insurance company.

Answer 7

I do not know of any insurance company that sells theft insurance only. But the biggest problem I see with your condition to purchase the insurance after the lost is
1. Many insurance companies want to view the vehicle before issuing a policy. Especially it is not currently insured.
2. What do you do if;
a. The car is recovered burned out, or stripped before you have time to purchase the insurance.
b. You purchase the insurance, not being aware of the recovery and then the insurance discovers that you committed fraud.

Answer 8

I guess it could work, but if you bought insurance and immediately (or even very soon after) reported it stolen, the insurance company would probably suspect what you had done. They might send out a private investigator to interview your neighbors and friends (and you of course) about all the details, and unless you were very clever and lucky they very likely be able to prove you lied.

Its just not worth going to jail over, the insurance companies aren't stupid and your not the first person to ever think of this.

Answer 9

well, first of all, in order to purchase comp or collision on a vehicle you need to have the vehicle inspected. and if you show up at the agency on a bike they will make you sign something saying you will bring the vehicle back in 24 hours or no coverage will exist. so, you get back on your bike and get home and your car is stolen. guess what? you never had the vehicle inspected so, no coverage!
what your talking about is auto insurance fraud, and once you get caught your in trouble, big time, they hire bull dog laywers, you think they will let you get off?
not to mention if you happen to get away with anything like this, guess whos paying your claim? ME, and your mom, and your friends and your country.

Answer 10

The same concept applies here as do the other situations. If you do not promptly report a theft to the authorities, any insurance company will raise a red flag, especially if your policy is fairly new.

Not to mention, of course, that doing so is insurance fraud and is punishable by real time behind steel bars.