The Consumer Federation of the Southeast today warned that a seemingly small change within significant Florida auto insurance legislation would undercut customer protections and the ability of investigators to root out and prevent fraud and auto theft.
The provision in question would eliminate mandatory pre-insurance inspections of certain used cars. This is a consumer-friendly requirement that law enforcement has used to prevent fraud since 1989.Jennifer West, executive director of the Consumer Federation of the Southeast said:
By requiring in-person inspections, the existing law deters scam artists from victimizing consumers with bogus transactions. Anything that stops this kind of fraud is money in the pocket of consumers, and there is no good reason to erase such an important protection.
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The insurance costs insurance companies less than $14 per vehicle; while data shows insurance fraud costs each household’s insurance policy $227 per year. Law enforcement and insurance investigators regularly use data from these inspections to advance their fraud investigations.
The provision is in Senate Bill 1026 and it would make the mandatory physical inspections optional for insurers. Similar language is contained in House Bill 659.
West said:The requirement helps hold down insurance premiums by detecting and reducing fraud. The current law protects used-car buyers and benefits everyone who purchases car insurance. Eliminating the requirement would be bad news for Florida consumers.
