WASHINGTON–State insurance legislators promised on Sunday to look into incorporating stronger sanctions into laws and rules governing airbag theft and fraud.

The Property-Casualty Insurance Committee of the National Conference of Insurance Legislators agreed to look into the issue at the request of the Coalition Against Insurance Fraud.

The P-C panel acted after Howard Goldblatt, director of government affairs for the CAIF cited data indicating that airbag theft and fraud continues “to be a big problem and a public safety issue, both for the consumer and the insurer.”

He cited instances where auto body shops buy stolen airbags to replace a deployed airbag and then charge the insurer the full retail price as if the product had been purchased from the manufacturer.

He explained that some auto body shops buy stolen airbags advertised on the Internet for $200, and then charge the insurer $1,200 or so for installing it in a car where the old bag had been deployed during an accident.

Of equal concern, Mr. Goldblatt said, the airbag that is installed is not the proper bag for the repair, reducing the potential safety for the user in the event of a crash.

Other problems include removing an un-deployed airbag from an auto prior to an adjuster reviewing the automobile. “The insurer will reimburse those body shops more than a thousand dollars for the repair,” he explained.

He also cited other instances where auto recyclers, used car dealers and auto body shops repair automobiles by faking the repair of the airbag. “Some cases have shown that junk including used beer cans were placed in the compartment,” he told members of the NCOIL P-C Committee.

To deal with it, he cited laws in New York and Colorado that require an invoice of bill of sale by the body shop for an airbag, prior to reimbursement by the insurer.

He also noted that New York further requires automobile accident reports to have a place for law enforcement to note whether the airbag was deployed in an accident. “There have been several incidents where this notation stopped a body shop from trying to defraud an insurer by claiming the need to replace a deployed airbag,” he said.

Mr. Goldblatt suggested that a model law be drafted based on laws in several states that make it a felony to steal or purchase a stolen airbag–or for a repair shop to repair a vehicle with a phony airbag.