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Bigmotor Scandal Unveils Massive Fraudulent Claims

by Celia

Investigation Reveals 30% of Claims Over Recent Years Were Fraudulent

Tokyo, Japan — Tens of thousands of fraudulent insurance claims have been uncovered in a scandal involving Bigmotor, a now-defunct used car dealership, accused of inflating repair costs through intentional vehicle damage and other deceptive practices, according to a report by Asahi.

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Four major nonlife insurance companies—Sompo Japan Insurance, Mitsui Sumitomo Insurance, Tokio Marine and Nichido Fire Insurance, and Aioi Nissay Dowa Insurance—have identified approximately 65,000 fraudulent claims linked to Bigmotor.

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Over the past five to eight years, insurers have scrutinized around 236,000 claims, with nearly 80% reviewed by early July. Of these, roughly 30% were found to be fraudulent.

In the wake of the scandal, Balm, the company that succeeded Bigmotor and rebranded as Wecars, has managed to agree on adjustments for only about 1,700 claims, representing just 2.6% of the total. Balm has suspended its own investigations, citing inadequate archival records to conduct thorough assessments.

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Moving forward, Balm has opted to resolve disputes through court mediation.

Bigmotor’s fraudulent activities included inflating insurance bills by intentionally damaging vehicles. Methods reportedly used included hitting cars with golf balls wrapped in socks, scratching them with screwdrivers, and breaking headlight covers, all to increase repair costs. This malpractice has contributed to higher insurance premiums for motorists.

The insurance companies conducted independent investigations and cross-checked findings with Balm to determine appropriate refund amounts. Although Balm declined to provide an interview, the company stated on July 11 that it would address and respond to insurance claims in good faith.

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