"These days, many Americans are worried about how much they have to pay for their various types of insurance coverage, including their auto policies. However, what they might not realize is just how much incidents of auto insurance fraud are likely to be driving up their premiums even if they themselves aren't affected by it in any way. The more insurance agents can do to explain this aspect of coverage, the better off both driver and agent are likely to be going forward. Data now suggests that people across the country paid between $5.6 billion and $7.7 billion on their auto insurance policies in 2012, the latest year for which data was available, just to cover the cost of fraud that has to be borne by their providers, according to a report from the Insurance Research Council. That accounts for somewhere between 13 percent and 17 percent of all premiums paid during that time. This data was based on more than 35,000 auto insurance claims that were closed with payments made. ""The costs associated with auto injury claim abuse make auto insurance more expensive for everyone,"" said Elizabeth Sprinkel, senior vice president of the IRC. ""Efforts to lower insurance costs must include measures aimed at reducing the amount of fraud and buildup in the system."" Fighting fraud going forward Meanwhile, it should be noted just how pervasive this kind of crime is, the report said. Nationwide, about 1 in 5 claims for either bodily injury or personal injury protection had the appearance of fraud or buildup of claims. It should likewise come as no surprises that instances of these issues were often greater than the national average in states that had no-fault auto insurance systems. However, the four states that led the way in this regard were Florida (31 percent), New York (24 percent), and Massachusetts and Minnesota (tied at 22 percent each). The reason that it might be so important for auto insurance agents to explain the kind of damage auto insurance fraud can do to the system as a whole is that it might help them to feel better about their coverage overall. That, in turn, will likely serve to improve their working relationship, which will then go a long way toward boosting customer satisfaction ratings. This will probably also serve to keep retention rates as high as possible."