If you're reading this and thinking about setting your car on fire or driving it into a ditch and reporting it stolen, please, please, please don't do that. You might get away with it, but you might not. And if you don't, you could end up in jail for a long time -- and that, combined with penalties and legal fees, won't exactly help your financial situation.A better solution is to call up the lender on your car and explain the situation. In case you haven't noticed, this is a really, really bad time to repossess a car because no one is buying cars. If you're able to demonstrate need, they may be able to work out a repayment plan that works for both parties: You keep your car and they don't get a car that they can't do anything with.
I could go on a self-righteous lecture about how insurance fraud rips off your neighbors who must pay higher premiums to account for the losses, but I won't bother. Car insurance fraud is a high-risk, low-reward venture and, just for purely selfish reasons, it's not something that anyone in his right mind would get involved with.