How drivers cheat their insurers

By Marilyn Lewis

Tony Soprano would be so proud. New Jersey, home of the fictional mob boss, has been crowned first in the nation for having the most residents who enjoy illegitimate farm-use discounts on the price of their auto insurance.

It's a heady distinction, sullied only a little by the fact that Jersey has the 11th-smallest farming industry among the 50 states.

Farmers or not, you can't say Jersey folks aren't resourceful. They emerged as kings in a report titled "Scam Alert: Study Reveals Crafty Urban Residents Cheat Auto Insurers." It is the fruit of research by Quality Planning, a San Francisco company that uses sophisticated analytical tools to verify policyholders' applications for insurance companies.

Runner-up: Connecticut

Nipping at New Jersey's heels for the flimflam farm-vehicle title is Connecticut. Yes, that Connecticut, whose capital, Hartford, calls itself "the insurance capital of the world." Call it Yankee ingenuity. Only five states have fewer farms.

Quality Planning's analysis of 150,608 conveyances nationwide whose owners claimed they were used in farming found nearly 8% registered "in areas where, according to a 2000 Census Survey, absolutely nobody is engaged in agriculture."

Rounding out the top 10 farm-discount abusers were Wisconsin, Maryland and Georgia, followed by South Carolina, Tennessee, Virginia, Ohio and Florida.

Farm discounts -- meant for cars and trucks used for work on farms and ranches -- were attached to, for instance, a BMW Z3, a Chevrolet Camaro, a Ford Focus, a Jaguar XJ6, a Porsche Carrera, a Mazda RX-7 and a Toyota Echo.

City and suburban drivers claim farm-use discounts for the juicy reduction of 10% to 20% on the cost of their premiums, says Tim Cox, a publicist engaged by Quality Planning. The industry calls its losses from these customers' creative or erroneous ratings "leakage."

• Video: Cut the cost of insuring your teen driver

"Sometimes they do it maliciously," says Robert U'Ren, a senior vice president at Quality Planning. "Other times, things just change in people's lives. The 15-year-old turns 16, and they forget to change the insurance. They change jobs, and the last person they are thinking of calling is the insurance agent. They're painfully honest most of the time . . . but people won't volunteer the new information knowing that it's going to change their rate."

Continued: Favorite cost-cutting tricks

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