Amidst an increase in the number of auto insurance fraud cases, the Korea Insurance Development Institute (KIDI) is launching a fraud-proof accident history verification system on March 24. (image: Korea Bizwire)
SEOUL, March 23 (Korea Bizwire) — The Financial Supervisory Service (FSS) has caught 20 individuals who faked car accidents using scrapped imported cars to seek insurance payouts.
The suspects, who are not related to each other, received a total of 1.3 billion won (US$ 1.16 million), or 65 million won (US$ 58,200) in compensation on average, by faking a total of 117 accidents. One suspect has faked 13 accidents over the past two years, which netted at total of 127 million won (US$ 113,770).
The FSS conducted an in-depth investigation into fraudulent cases based on data accumulated between October 2009 and October 2014, and discovered that the most of the suspects kept changing the registration numbers of damaged cars to erase their accident history, and succeeded in re-insuring the cars at normal rates.
Amidst an increase in the number of auto insurance fraud cases, the Korea Insurance Development Institute (KIDI) is launching a fraud-proof accident history verification system on March 24. Upon the input of a car registration number, the new data query system will enable users to view every accident record for the vehicle itself.
The current system offered by the KIDI only generates accident history information related to the registration number alone. In Korea, about 244,000 vehicles had their registration numbers changed last year, and 22 percent of those vehicles had their number changed following accidents.
By Lina Jang (lina@koreabizwire.com)
