New tactics—from AI-altered damage photos to coordinated repair scams—are making fraud harder to detect and more costly for everyday drivers and homeowners.

LOS ANGELES, March 24, 2026 /PRNewswire/ -- Insurance fraud is no longer limited to staged accidents or exaggerated claims—it's becoming faster, more sophisticated, and increasingly digital. As fraud schemes evolve, Mercury Insurance (NYSE/NYSE Texas: MCY) is helping consumers understand how these scams work, how they can unknowingly get caught up in them, and what steps to take to protect themselves.

Insurance fraud costs Americans billions each year. According to the Federal Bureau of Investigation, non-health insurance fraud exceeds $40 billion annually, adding an estimated $400 to $700 per year to the average family's premiums. The Coalition Against Insurance Fraud estimates total insurance fraud across all sectors can reach $308 billion annually, highlighting the growing scale and impact of these schemes.

"Fraud today isn't always obvious—and that's what makes it dangerous," said Steve Wang, Manager, Sr. Divisional Claims for Mercury Insurance. "We're seeing more cases where consumers don't realize they're part of a scheme until it's too late. Whether it's a suspicious repair shop, a tow truck that shows up uninvited, or manipulated photos used in a claim, these tactics are designed to look legitimate."

Traditional fraud—like staged collisions—still exists, but new tactics are rapidly emerging. Fraudsters are increasingly using digital tools to alter damage photos, impersonate legitimate businesses, and exploit consumers in vulnerable moments—especially after accidents or severe weather events. The National Insurance Crime Bureau warns that fraud activity often spikes following major disasters, when urgent repairs and confusion can make it easier for bad actors to take advantage.

For consumers, the impact goes beyond financial loss. Fraud contributes to higher premiums, longer claims processing times, and increased scrutiny for legitimate claims.

"Every fraudulent claim drives up costs across the system," Wang added. "But beyond the financial impact, it can also delay help for people who genuinely need it after an accident or disaster."

Mercury Insurance encourages consumers to stay alert and take a few key precautions: verify the identity of tow truck operators and contractors before accepting help, work with reputable or insurer-recommended repair shops, protect personal and policy information, document incidents thoroughly, and report suspicious activity as soon as possible.

Mercury Insurance actively investigates suspicious claims and works with law enforcement and industry partners to combat fraud and protect customers. By combining advanced analytics with experienced claims professionals, Mercury aims to identify fraud early while ensuring legitimate claims are handled quickly and fairly.

"Education is one of the most powerful tools we have," Wang said. "When consumers know what to look for, they're far less likely to become victims."

For more information about insurance fraud and how you can spot it, visit the Mercury Blog.

About Mercury Insurance

Mercury Insurance (NYSE: MCY) is a multiple-line insurance carrier predominantly offering personal auto, homeowners, renters and commercial insurance through a network of independent agents in Arizona, California, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia, as well as auto insurance in Florida. Mercury writes other lines of insurance in various states, including commercial, business owners and business auto, landlord, home-sharing, ride-hailing and mechanical protection insurance.

Since 1962, Mercury has provided customers with tremendous value for their insurance dollar by pairing ultra-competitive rates with excellent customer service, through more than 4,200 employees and a network of more than 6,340 independent agents in 11 states. Mercury has earned an "A" rating from A.M. Best, as well as "Best Auto Insurance Company" designations from Forbes and Insure.com. For more information visit www.MercuryInsurance.com or follow the company on X, Instagram or Facebook. Media interested in receiving updates from Mercury can learn more at the Mercury Newsroom.

Media interested in receiving updates from Mercury can learn more at the Mercury Newsroom.

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SOURCE Mercury Insurance