Drivers may see £2,000 losses from car insurance scams by ghost brokers – ‘telltale signs’

Martin Lewis offers advice about cancelling car insurance

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Ghost brokers pose as middlemen for well-known insurance companies, claiming they can offer drivers a legitimate car insurance at a significantly cheaper price. New figures from Action Fraud, the national fraud and cyber crime centre, reported they received 351 reports of ghost broking between January and August 2021.

The reported losses for all age groups in this time frame totals £786,700.

This means the average victim loses around £2,250 at the hands of the ghost broker.

Scammers use a variety of techniques to offer the customer an attractive looking deal, including forging insurance documents or even falsifying your details to bring the price down.

They may even take out a genuine policy for you, before cancelling it soon after.

For many, they don’t realise they don’t have genuine cover unless they get stopped by the police or make a claim.

The research also found that cash-strapped young people were most at risk, with fraudsters targeting those between the ages of 17 to 29.

Gareth Shaw, Which? Head of Money, spoke of how drivers can avoid being made victims of the fraud.

He said: “We’ve heard dozens of stories at Which? from people who have been the victim of ghost brokering, sometimes being conned out of hundreds of pounds or discovering that some aspect of their identity has been woven into a stranger’s car insurance policy.

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“There are some telltale warning signs that you might be speaking to a ghost broker, these include if they are using price comparison sites for quotes, don’t have a website or landline number you can contact them on and don’t appear on the Financial Services Register on the FCA’s website.

“If you receive suspicious correspondence from an insurer relating to a policy you don’t own, it’s possible that a fraudster has used some of your details.

“Don’t panic, but make sure you contact the insurer and Action Fraud.

“We’d also recommend keeping an eye on your account and checking your credit report for any searches you don’t recognise.”

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