The Most Common Car Repair Scams in Canada – And How to Avoid Them?
Scams and Frauds
Among the many scams perpetuated in the modern world, Insurance scams rank pretty high.
Frauds and scams not only impact the insurers, but they also have a cascading effect on insurance rates. Insurance companies pay out more money for settling claims, leading to expensive coverage.
It is a vicious circle and subscribers should learn as much as they can about these scams so they can avoid them.
High Auto Insurance Rates
All Canadian provinces and territories require drivers to have liability and accident benefits/bodily injury coverage, though Collision and Comprehensive insurance are optional.
British Columbia and Ontario have the highest auto insurance rates in Canada; one of the biggest reasons is the wide prevalence of scams and frauds. A recent investigation by Aviva Insurance Canada concluded that over 50% of the total repair costs billed to Aviva (as part of the investigation) were fraudulent.
It is estimated that auto repair fraud costs over $500 million per year in Ontario and over $2 billion across Canada. On average, about $100 to $150 of your premium goes toward paying for fraud.
Repairing your car after an accident can be an expensive experience and a scam just complicates the situation. A well-informed customer is conscious of the scams that can be perpetuated.
A fake car accident, a false injury claim or an illicit repair shop are just a few of the many fraud types that you may encounter.
Types of Auto Repair Scams
The accident recovery process works like this – If you are involved in an accident, damages will be paid for up to the value of the car. If the estimated cost of repairs is beyond the value of the car, you will receive the replacement cash value.
And this is where the fraudsters get into action.
A few of the most common auto repair scams are listed below.
1. Fake repairs
The most common scam is to bill the client for fake repairs or upgrades that are not strictly needed. This usually involves an unexplained leak, an oil change upgrade or premature replacement of parts, an unanticipated repair that did not show up in the initial inspection, etc.
2. Low-quality replacement parts
Illicit Body shops may use counterfeit, refurbished or obsolete replacements for the damaged parts. However, they charge for the prescribed spare parts from your insurance company, and pocket the difference.
You may visit them again when the low-quality repair fails (because they offered a “sweet deal”). As a result, they end up with the surplus from the claim and get paid again for the second visit.
3. The Good Samaritan Scam
This is a very innocent-seeming scam, usually happening right after an accident. A roadside mechanic or tow-truck driver offers help to the victim, posing as a good Samaritan. They recommend a particular body shop or a towing company.
Although everything seems convenient and helpful, the bystander or the tow truck driver is trying to scam you. They have an understanding with those businesses and will get a cut of the insurance claim.
Generally, the victim does not realize he is being cheated, until an inflated bill is presented, or a fictitious repair is reported and claimed from his insurance company.
How Do You Avoid Auto Repair Scams?
Now that you know a little more about what can go wrong, what can you do to avoid falling prey to scams?
Always go in for a reputed collision repair shop that gives you an in-depth, comprehensive estimate and that accepts all Insurance Policies. Talk to the experts at North York Auto Collision in Toronto, for anything to do with Auto Repair.
Additionally, a few steps can protect your interests and ensure you get a fair deal.
- Immediately inform the police or the closest Collision Reporting Centre and your insurance company of any accident:
You need to report all accidents, regardless of the amount of damage, even if you are paying for the repairs out of pocket. Reporting within 24 hours enables your insurance company to provide you with the right guidance.
- Take pictures of the scene:
In addition to a police report, take photographs of the damages to the vehicles involved in the accident. These photographs will serve as evidence along with all the information that you can remember. Write down as many details as you can notice.
Despite your best efforts, if you feel that you are being ripped off by your auto-repair mechanic, you can take the following steps to ensure the redress of your complaint.
- Advise the business of your complaint by letter, email, or phone, ensuring you have a record of the communication. If they still do not respond to your complaint, you can:
- file a complaint with the Ministry of Public and Business Service Delivery, or
- take the issue to court.
- Contact your insurance company, so that they investigate the matter and advise you on how to proceed.
- You can file a complaint with the Insurance Bureau of Canada.
By law, if a repair shop misrepresents the need for a repair or the quality of the parts they provided, you have rights under the Consumer Protection Act.
Finally, what is it that you need?
A car repair shop that recommends repairs that will get the car in good working condition and gives you the confidence that your vehicle is in good hands.
If you are not convinced about any of the recommendations, consider getting a second opinion. Or even a third.
Ultimately, it is your car and your money; and as a customer, you deserve the best service.