This article is adapted from an earlier version published by Auriemma Roundtables. This DRN edition has been updated for our audience.
The Growing Scope of the Challenge
Auto insurance fraud remains one of the toughest problems confronting the U.S. insurance market. The Coalition Against Insurance Fraud estimates that fraudulent activity costs the American economy more than $308.6 billion every year. Within property and casualty insurance, those losses total tens of billions annually.
In personal auto, premium leakage tied to misrepresented driver details, mileage, or garaging location reaches about $35.1 billion per year, according to Verisk. When you add organized fraud rings, staged collisions, and inflated repair bills, the financial effect on carriers expands further.
Consumers ultimately absorb these costs. The FBI reports that U.S. households pay roughly $400 to $700 more each year in premiums to offset fraud-related losses.
Meanwhile, conventional defenses such as manual file review and post-claim investigation are struggling to keep pace. Fraud schemes are evolving faster, and data gaps make it difficult for insurers to identify inconsistencies early, before losses escalate.
Why Vehicle Location Data Matters
This is where DRN Data delivers meaningful support. As the operator of the nation’s largest License Plate Recognition (LPR) network, DRN captures more than 500 million vehicle scans each month. These verified vehicle sightings provide insurers with a reliable view of vehicle location over time.
With objective vehicle location data, carriers gain a stronger way to identify misuse and prevent fraud. By reviewing vehicle sightings, DRN Data builds a fact-based record showing where and when a vehicle has been observed. This helps insurers validate usage patterns, confirm garaging information, and surface inconsistencies before they become costly claims.
DRN’s network collects millions of plate reads daily nationwide. When organized through the DRNsights for Insurance platform, that information provides insight into how vehicles are used, where they appear, and whether those patterns align with policyholder statements. This is especially valuable at underwriting, renewal, and claims stages, where accuracy and speed directly affect outcomes.
Rather than replacing existing processes, DRN Data strengthens them. It fills recurring verification gaps in documents and self-reported details, enabling carriers to rely on objective evidence instead of assumptions.
How LPR Data Supports Fraud Prevention
Confirming Vehicle Activity Patterns
Vehicle sighting information provides a clear view of where a vehicle has appeared over time. This helps confirm whether thefts, collisions, or other reported events align with the details provided in a claim.
Validating Garaging Information
If a policyholder reports a primary garaging location but sightings show consistent presence elsewhere, insurers can quickly identify the mismatch and address it before renewal.
Identifying Coordinated Fraud Signals
Vehicle sightings can reveal patterns across vehicles and locations that might otherwise go unnoticed. Repeated co-locations or overlapping appearances may indicate organized activity that standard claims data does not easily surface.
Verifying Prior Condition
Time-stamped vehicle images give adjusters a reference point for condition before a claim is filed. This visual context helps confirm pre-existing damage and reduces inflated or false claims.
Supporting Faster Response Through Timely Alerts
When a high-risk vehicle appears again in the network, insurers can be notified promptly. Earlier awareness enables faster review, lower claim severity, and improved recovery outcomes.
Practical Applications in the Insurance Lifecycle
LPR-based vehicle location intelligence supports multiple carrier functions, not only claims.
Underwriting and Renewal Integrity
Carriers can validate garaging and usage at policy start and renewal, reducing premium leakage and improving rating precision.
Claims Triage and Prioritization
Vehicle sighting history helps identify inconsistencies early, allowing SIU resources to focus on the right files sooner.
Portfolio and Risk Review
Aggregated vehicle activity patterns can highlight emerging risk clusters, exposure shifts, or segments that may be misclassified.
Taken together, these applications promote a proactive risk strategy, helping insurers act on verified information instead of reacting after fraud impacts results.
Where Vehicle Location Data Fits Across the Insurance Lifecycle
Integrating LPR-based vehicle location intelligence changes how fraud risk is managed and delivers several advantages:
Improved detection accuracy by connecting time and location into clearer fraud indicators.
Faster resolution because reviews start earlier and rely on stronger evidence.
Reduced premium leakage through scalable validation of key rating variables.
Stronger deterrence as organized fraud networks recognize that vehicle activity can be verified.
Higher operational efficiency by reducing manual work and accelerating review cycles.
With verified vehicle location data in place, carriers can move from reactive investigation to proactive, evidence-based fraud prevention.
Practical Integration Considerations
To maximize the value of vehicle location intelligence, insurers should focus on workflow integration and oversight.
Embed LPR checks into underwriting, renewal, and claims processes so verification becomes routine.
Establish clear thresholds to flag location anomalies or unusual vehicle activity patterns.
Encourage collaboration between underwriting, claims, and SIU teams to share a unified risk view.
Maintain compliance with privacy laws and ethical standards to protect trust and transparency.
Measure outcomes including detection lift, leakage recovery, and claim cycle time to track program impact.
These steps help carriers improve accuracy and performance without adding unnecessary complexity.
Conclusion
Insurance fraud is both a financial and trust issue that touches every part of the insurance value chain. As schemes grow more sophisticated, carriers need stronger tools to verify information quickly and confidently.
LPR-based vehicle location data provides that verification layer. It helps insurers confirm where vehicles are observed, how vehicle activity aligns with reported details, and when inconsistencies require review. The result is a more efficient, more fair, and more transparent insurance system for carriers and honest policyholders alike.
Learn more about how DRN Data and LPR intelligence support data-driven fraud prevention at drndata.com/insurance.