Friday, 11 October 2013

Drivers warned to be wary of enticing fake insurance policies

Drivers warned to be wary of enticing fake insurance policies

Young and recently qualified motorists are being warned to thoroughly check 'enticing' insurance policies after a recent spate of arrests has signalled a spike in the phenomenon of 'ghost broking'.
 
These 'ghost brokers' target young and newly qualified drivers by offering insurance deals that appear much cheaper than many of the often extortionate policies presented by legitimate insurance providers.

Motorists only become aware of the scam when it comes to making a claim, when there is nothing in the way of support from the dodgy insurance companies.

Drivers also run the risk of racking up fines, penalty points, having their vehicles seized and, in the event of a major accident, incurring hundreds of thousands of pounds in costs, as the insurance isn't valid.

Police recently arrested 27 people in connection with the sale of fake insurance policies in one of the largest crackdowns of its kind. More than 170 officers carried out 28 search warrants in a series of dawn raids across the country.

The insurance fraud enforcement department – a unit working within the City of London police – suggests that thousands of motorists have already been duped by the scam but the true extent of the problem remains unknown as many drivers will assume their cover is legitimate.

Kerry Michael, director of insurance services at the RAC motoring group, said: "This is a new and worrying crime which preys on young drivers offering them cheap insurance rates with bogus policies. It is particularly worrying when you consider that many of the individuals taken in by 'ghost brokers' are those who can least afford the devastating financial and personal consequences of being involved in an accident without valid insurance."

The police and RAC are advising buyers to avoid enticing policies that are often sold through social networking sites, on fake websites and even in genuine printed ads found in classifieds and posted in university clubs and bars.

The 'ghost brokers' will nearly always claim they are linked with genuine insurance companies and will even send fake documents to seal the deal.

Above all else, if the deal appears too good to be true, it probably is. Buyers can also check that insurance provider is on the Financial Services Register before buying a policy

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