Twenty-three people from New York and New Jersey -- among them a Hunterdon County man -- have been charged with fraud after claiming to be Keystone State residents in order to save money on car insurance, according to the Pennsylvania Attorney General's Office.
Also charged in the rate evasion scheme is a Reading, Pa., woman, the news release says. It was not immediately clear why she is charged.
Rate evaders are out-of-state residents who provide false information to the Pennsylvania Department of Transportation in order to obtain state driver's licenses or vehicle registrations, the release says. They use the state-provided documentation to obtain Pennsylvania insurance policies for their vehicles, the release says.
Attorney General Tom Corbett estimates that rate evaders account for $12 million to $15 million worth of insurance claims each year on Pennsylvania policies. That leads to higher premiums for everyone, he said.
“Because of differences in automobile insurance premiums and coverage requirements, some New York or New Jersey drivers can save anywhere from $1,000 to $4,000 per year by falsely claiming to live in Pennsylvania and insuring their vehicles here,” Corbett said.
“The real financial losers in this scam are the honest drivers of Pennsylvania, whose premiums increase when their insurance companies pay claims for drivers who lied about living in our state.”
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