A dangerous new form of motor insurance fraud is putting lives at risk, a Shropshire insurance broker has warned.

In so-called “cash for crash” incidents, organised criminals force collisions with innocent motorists in order to make false or inflated insurance claims. According to figures from the Insurance Fraud Bureau (IFB), there have been more than 22,500 staged motor collisions since 1999.

Helen Andrews, the regional director of Ludlow insurance broker Smart & Cook, said: “Both the police and insurance companies are increasingly concerned by the rising number of such incidents in the area.

“Not only are such crashes a deliberate attempt to defraud insurance companies, but it is also hard to overstate how potentially dangerous these crimes are.”

“Cash for crash” fraudsters typically perform hazardous emergency stops on busy roads, with the aim of inducing other motorists to collide with them, said Helen.

The gang will then make inflated claims to the motorist’s insurer, which typically include fictitious injuries and damage to vehicles.

According to the IFB, gangs can net up to £30,000 from each incident – and such funds may then be used to fund activities such as drug trafficking and other serious crime.

Helen added: “Not only does every ‘cash for crash’ fraud run the risk of inducing a real accident and causing serious injuries, but innocent motorists also pay for such crime through higher insurance premiums.

“We urge every driver to be cautious and to alert both the police and their insurance company if they have any reason to believe an accident has been staged.”

Police in West Yorkshire, Hertfordshire, Bedfordshire and London have all made arrests in connection with “cash for crash” fraud in recent months.

The IFB has presented research on the extent of the problem to Parliament’s All-Party Working Group for Insurance and Financial Services.

Following the meeting working group chairman John Greenway MP described staged motor accident fraud as “a significant national problem impacting many cities across the UK and one requiring an urgent national solution.”

By Neil Thomas