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Michigan drivers urged to be on the lookout for auto insurance scam

Posted On Wed, May 25, 2011

Auto insurance fraud can come in many forms, one of which is when companies claim to be direct insurers but, in fact, aren't.

Some Michigan motorists have fallen victim to this scheme, and to make sure more people aren't defrauded, the Office of Financial and Insurance Regulation has issued a warning to Detroit-area drivers.

According to the OFIR, the activity is being perpetrated by an outfit called Ethos Insurance. After customers pay the fraudulent insurer money, the group sends the customer a certificate detailing their policy. But the OFIR says the group is not licensed by the state of Michigan.

"Detroit drivers who purchased auto policies from Ethos or Don Diamond need to buy legitimate coverage immediately," said Kevin Clinton, commissioner for OFIR. "Right now they’re driving without insurance."

Officials urge motorists who feel they may have been defrauded to contact the OFIR directly.

The National Insurance Crime Bureau is in the business of tracking down fraudulent activity relating to auto insurance. On a monthly basis, the NICB releases reports detailing issues such as questionable claims and how to spot staged accidents. 

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