Drive Against Automobile Insurance Fraud Opens

“Fight Fraud,” a statewide campaign to combat the escalating problem of fraudulent auto insurance claims, was launched Tuesday in San Diego.

Under the program, San Diegans can collect a $5,000 reward for contributing information that results in the conviction of people who defraud insurance companies, said Len Lebowitz, founder of Public Insurance Service. The Sherman Oaks-based company, which has an office in San Diego, is sponsoring the campaign in conjunction with the California Highway Patrol and other state agencies.

“Insurance rates are going up at a rate of 20% to 40% each year, and most of this is due to out-and-out thievery,” Lebowitz said, referring to individuals and organized rings that cause accidents or report nonexistent ones to collect insurance money.

Lebowitz said his firm is offering the rewards because if fraud is stopped, rates will come down and that will mean more clients for his company. He said rewards and the prospect of lower premiums should serve as incentive for getting the needed public support.

An estimated one dollar out of every three in insurance premiums pays for fraud, he said. In California alone, insurance companies pay $65 million each year in fraudulent claims, said Chief Ben Killingsworth of the CHP Border Division. During the first nine months of 1985, the CHP made 20 arrests for car insurance fraud in San Diego County, which involved claims totaling more than $160,000.

“There are probably 50 times more of these (schemes) going on than we’re aware of,” Killingsworth said.

He said his division welcomed Lebowitz’s help in combating this crime because “we are so woefully undermanned.” He said the problem is especially prevalent in San Diego because of the ease with which claimants take cars across the border, report them stolen and then collect from their insurance companies.

Persons with information about fraudulent auto insurance claims can contact the program at P.O. Box 5669, Sherman Oaks, Ca. 91403.