Avoid Car Insurance Fraud

Is your insurance policy genuine?

Is your insurance policy genuine?

How can you avoid car insurance fraud.

On 28th October 2013, a man was jailed for his part in a scam that swindled more than £500,000 out of unsuspecting drivers by selling them fake insurance policies. By all accounts, this prosecution has not put a stop to the problem, merely highlighted its existence.

According to the Police and Insurance companies, it is mainly young or inexperienced drivers who are paying out for insurance policies that subsequently turn out to be fake leaving the victims out of pocket and without insurance.

Insurance costs are high for many people but it is young or new drivers who are forced to pay the highest premiums of all and have the greatest need to search for the best deal around. These same people have little or no experience of buying insurance making them ideal targets for exploitation by criminals.

The scam is very simple. The fraudsters set up a website or advertise in places likely to attract the target audience. Motor insurance is offered at a very low price, the money is taken, either in cash or by money deposited into bank accounts being used by the fraudster, and a worthless policy document and insurance certificate issued in exchange.

Sometimes, a genuine policy of insurance is arranged with an insurance company but details of the insured person are falsified to obtain the policy at very low cost, rendering the policy invalid, but the vehicle insured is shown on the DVLA database as insured and therefor unlikely to be stopped by police.

How to recognise a scam? If you are looking at a website it could be very difficult to spot a scam but there are things you can do to protect yourself from fraud. A genuine broker will take payments by credit card and if the sale is fraudulent the bank will usually reimburse you.

Be aware that there is no such thing as fixed price motor insurance.

If you believe you are dealing with an insurance company you can check they are members of the Motor Insurance Bureau.

If you are dealing with a broker, ask which insurance company is offering the policy and, if in doubt, check the details of your insurance direct with the company before you part with any money.

After a policy is issued you can check the askMID.com database to make sure your car is insured?