Ghost Broking Can Have Dire Consequences For The Innocent Motorist

5 Steps To Guard Against Motor Fraud

Recent coverage in the media has highlighted a worryingly growing trend by fraudsters issuing fake insurance documents.  Innocent motorists assume that they have insurance but in fact they have merely paid for fictitious policies.

Police have made several arrests for ‘Ghost Broking’ across the country.   Perpetrators of this crime use social media, the internet and small-ads to advertise cheap insurance targeting mainly young drivers.

Either fictitious documentation is issued for policies which do not exist or the fraudsters alter key information given to them (address, date of birth) and apply to insurance companies on the customers’ behalf.

With increasing insurance costs – particularly for young drivers, many are looking for cheap ‘budget’ insurance and such scams can appear attractive.

In November 2011, the BBC estimated that 20,000 motorists could be driving around uninsured after buying fraudulent or fake cover.  Innocent drivers in such circumstances could find themselves in the position of having their vehicle seized and face fines. In the event of an accident or theft they will have no cover.

5 Precautions to take to protect yourself from ‘Ghost Broking’

1.  Compare the quote for your motor insurance with other quotes – if it appears significantly lower than other quotes you have received –check it out. (See below 3 & 5)

2.   You can see whether your Policy is listed on the ‘Motor Insurance Database’.  (This records the policy details of all vehicles insured in the UK.) If your vehicle is not listed on the database your policy is not legitimate.

3.   If you have concerns regarding whether a Policy is legitimate (even if recorded as in point 2), you can contact the insurer or insurance underwriter direct. (Note: The contact numbers given on the documents/advertisement may be false.)

4.   If your personal details on the documentation are not accurate or do not match the information held by your insurer you may have been sold a fraudulent policy.

5.   Before taking out a policy, you can check that the insurance adviser is on the Financial Services Register before you buy a policy from them.

Should you be the victim of fraudulent or fake insurance cover you should contact the Police.

Sources:          Association of British Insurers              BBC News