The Insurance Fraud Bureau estimates that 'cash for crash' insurance scams cost insurance companies around 350 million each year. The cost is passed onto careful motorists in the form of rising insurance costs, and it is estimated that cash for crash scams account for an additional 49 of a driver's premiums.

Cash for crash scams are orchestrated by criminal groups looking to make money through fraudulent insurance claims. In most cases, they will approach a car owner - usually with an old and low value car. The owner will be offered money to use the car in a staged accident. After the accident, the owner is told what to say to the insurance company and given details of the incident so that they can claim for a replacement car and claim compensation. Many owners go a step further by visiting their doctor with fake whiplash claims to add further value to their compensation.

The gangs involved tend to target older drivers who are on their own. Driving in front of them, they will brake suddenly, perhaps at a roundabout or t-junction, giving the driver behind no warning and causing a crash. Often, they will disconnect their own brake lights so that there can be no warning given at all. While they take great pains to ensure that the accidents happen at low speeds, the driver and his accomplices will often get out of the car, claiming whiplash injury. They then demand money from the innocent party, playing on the fact that they will not want to jeopardise their no claims bonus. In 2009, a fraudster using this method was jailed for four and a half years, after extorting around 12 million from innocent drivers.

The Insurance Fraud Bureau has released a checklist for drivers who feel they may be the victims of a cash for crash scheme. Their recommendations include:

. Do not admit blame or say anything other than 'it is a matter for our insurance companies.'

. The other vehicle is crucial, so note down a basic description. Check how many passengers there are in the other vehicle and note their descriptions.

. If possible, take pictures of the accident scene, damage to other vehicles and, if you can do so without inflaming the situation, of the other driver and passengers.

. Be wary of companies that contact you out of the blue offering to repair your car or to find a replacement vehicle.

. Share your suspicions with your insurer as soon as possible.

It also pays to be aware of witnesses who appear on the scene quickly, as they may be part of the gang. Victims are advised that under no circumstances should they part with any money at the scene of the 'accident'.

Possibly the most useful piece of advice in avoiding cash for crash schemes is for drivers to drive with vigilance and care. In addition, it is worth checking safety features such as your seat's position, position of the headrest and the distance between yourself and your airbag, as even low speed impacts can have tragic consequences if adequate safety measures are not taken.