Everyone knows about the professional criminals who are now working up and down the country to bilk insurers out of their money. They stage accidents, fake injuries and receive several billion dollars a year for their trouble. Why, you ask, do they get away with this. The answer comes in two parts. The first is at state level. As you might have noticed, almost all states are running deficits and are under pressure to find savings – for some reason, no state wants to be seen raising taxes. This means even essential services are being cut. So when it comes to law enforcement, where does a Police Chief spend his reduced budget? What are the priorities? Well, we all want to feel safe so a focus on violent crimes like robbery and burglary wins votes in the election. So-called white collar crime takes a back seat. That means local police forces only investigate fraud when it’s really serious, i.e. there’s a lot of media coverage. The FBI are interested in anything crossing state lines and there is a task force set up to deal with insurance fraud. But this is a drop in the ocean when you consider how many billion dollars are involved every year.

The second reason is that you are not exactly overjoyed by the prospect of better fraud detection. Just imagine the sequence of events. Insurance companies have to recruit and train investigators to work alongside claims adjusters. This immediately boosts the insurer’s costs which get passed on to you in higher premium rates. Now all these eager-beaver investigators finish their training and they are released on to the current files. Suddenly everything slows down as these investigators decide whether there’s anything fishy about your claim. How long are you going to put up with someone poking around your claim to decide whether you really did suffer whiplash in that accident? At what point do you start complaining? It’s possible, of course, that these investigators may detect real fraud. If so, the savings they make could start paying their salaries and the premium rates would come down. Well that’s the theory, anyway, and we can all dream.

The problem can be stated simply. If you take your eyes off the road, you will not see the other vehicle coming toward you. This makes you a danger to other road users. The group most likely to fall into this trap are young drivers. Not only are they the least experienced behind the wheel. They are also the ones with the most peer pressure to reply to the text message or answer the cell phone call immediately. The evidence cannot be more clear. Looking at all the different ways in which teens die through disease and accidents, crashes in motor-vehicles are the leading cause of death. The government estimates that, in 2009, about 5,500 people were killed and more than half-a-million injured because one of the drivers was distracted.

In a perfect world, this would be resolved by a discussion at home. As a parent, you would sit down with your children and explain the risks. The statistics are available on the internet to back up your warnings. Your children would nod their heads wisely and swear by all they hold holy not to continue this dangerous practice. Except this would not work in most families. What teens say to their parents is not how they act when they are outside the home. So now comes the hard choice. Do you sit back and rely on prayer every time they drive off into the wild blue yonder, or do you take positive steps? First, a little law: it’s a criminal offense to operate any transmitter that will block or jam wireless communications. So you would face big fines if you were found jamming mobile phone signals. But it’s probably not an offense if you instal equipment in your vehicle that acts as a passive block to the signal. The reason for the distinction is that if you created a cone of silence around your vehicle by transmitting a signal to jam all the cell towers, you would cut off all the other users in your area. While this might make the roads safer, it would seriously inconvenience everyone else. More importantly, it might interfere with emergency calls for the police and ambulance. So passive shielding is probably legal because it does not interfere with any other vehicle or person on the sidewalk. Taking this simple step means you no longer have trust issues with your teen (until he or she works out how to turn it off or get round the shielding, e.g. by putting an antenna outside the vehicle).

Having a car involves many responsibilities, some of which may be not as pleasant as driving a car and involve additional costs. Yes, we are talking about vehicle insurance. It’s definitely one of the most irritating aspects of owning a car and a cash-consuming one. Ask any driver and he will tell you that his or her insurance could be less expensive, since it takes a good bite off the family budget. If you are in the same situations as millions of drivers in the country and want your car to be not as expensive to insure as it is now the following money saving tips will definitely help you optimize your costs effectively:

Modify your policy

Vehicle insurance comes in many forms and delivers many options to choose from. When there are many different coverage options included into your policy it becomes very expensive. So your aim when optimizing your insurance costs is to strip off all the unnecessary coverage features and leave only those that are really needed. In fact, the only type of coverage that is legally required is the third party liability whereas all others are optional. Sure, it doesn’t mean that you have to strip down your policy to the bare minimums. But make sure to take some time and think about the things you really need with your policy and things you can leave behind. This will certainly cut your insurance costs effectively.

The world would be a better place if everyone was trustworthy and honest. Sadly, human nature seems to have come with a selfish gene. We want what we haven’t got. We don’t want to pay for what we need. There was a recent piece of research which staged accidents at intersections involving a bus. The point of the study was to discover how many of the innocent people on the sidewalks would run on to the bus and claim to have been injured. Needless to say, the results did not show city dwellers in a good light. So, when people were first working through the basic statistics of assessing risks, it was obvious there was less risk if people drove only a few miles a week. But if they were commuting long distances on busy interstates, the risk of accidents grew high. The insurers reasoned it would be good to pitch the premium rates to reflect the risks. Except how could they trust the drivers to make an honest declaration of how many miles a week they drove? The answer, sadly, was that no one was trustworthy if allowed to self-certify mileage. When insurers ran a trial, asking drivers to bring in their vehicles for their odometer readings to be taken, everyone quickly learned how to wind back the count of miles.

Well, now technology has arrived that eliminates the risk of cheating – until someone learns how to hack the black boxes, that is. For now, insurers like Progressive are selling a basic policy plus monitoring equipment to plug into your vehicle. The insurer can then monitor when, where and how far you drive. Some insurers are even fitting a GPS transmitter. This is useful if your vehicle is stolen or you report a breakdown and a tow truck has to find you.

Many consider this new technology an invasion of their privacy. The question you have to answer is whether you want the discounts. As a low mileage driver, you pay a monthly premium based on how far you drive and whether you avoid driving at peak times. Before you answer, note some insurers also collect data from your vehicle showing how often you break suddenly, whether you swerve from side to side, and other features of your driving style. Should you have an accident and make a claim, the insurer has a record of how you were driving at the time. If you claimed you hit the other car because you were swerving violently to avoid a moose, the recording may show a slightly different story (ignoring the problem of explaining how there came to be a moose loose in your part of town).

When an airplane crashes, we’ve all been brainwashed into watching the search for the black box. That’s the onboard recording device that captures what the pilots were saying as the plane fell from the sky as well as storing all the technical information from the instruments. We’re told it’s vital to be able to explain why each aircraft crashes. After all, the larger planes carry many passengers and, if one were to crash into a city center, it could do a lot of damage. We all have an interest in reducing the risk of air accidents. That’s why we’re hooked as television cameras record submarines going down to search the seabed to recover these vital boxes and as many bits of the plane as possible. Remarkably, experts rebuild as much of the plane as possible to see more clearly what damage was sustained before the plane hit the ground or fell into the sea.

Have you heard of event data recorders (EDR)? These are the little black boxes for the vehicles we drive on our roads. In 2008, a report published by the National Highway Traffic Safety Administration (NHTSA) admitted between 65 and 90% of vehicles were already fitted with EDRs. The reason for the big range in the estimate is easy to explain. Almost every new vehicle rolling off the assembly line has an EDR fitted. It’s been a standard component for many years. But it’s not entirely clear how many older vehicles are still driving around without one of these recording devices inside. All we can say is that, as we slowly throw the old vehicles away, we’ll slowly move up to 100% installation. How can you tell whether your vehicle has an EDR? Curiously, until 2011, manufacturers did not have to tell you. Now, if you look in the driver’s manual, you’ll find confirmation.