Ghost brokers con young drivers out of thousands of pounds with this insurance scam – how to avoid it
Drivers aged between 17 and 24 were scammed out of £164,993 over four years, according to new police figures
YOUNG drivers are being warned to stay alert to fake "ghost broking" insurance scams online which leave motorists unknowingly driving illegally without cover.
Motorists aged between 17 and 24 were found to be the age group that is most likely become victims, and were conned out of £164,993 over four years, according to new figures from the Insurance Fraud Enforcement Department (IFED).
Fraudsters pose as insurance brokers who offer too-good-to-be-true deals typically via adverts on social media sites like Facebook and Instagram.
Conmen forge insurance documents, falsify the driver’s details to bring the price down, or take out a genuine policy before cancelling it soon after - claiming the refund plus the victim’s money.
The fraud is only revealed when the driver tries to make a claim or is stopped by cops.
The new figures found that drivers in this age group were scammed out of £912 each on average between November 2014 and July 2018.
How to avoid being caught out by 'ghost broking'
FOLLOW these tips from Action Fraud to avoid becoming a victim to ghost broking:
- Trust your instincts – if an offer looks too good to be true, then it probably is.
- Ghost brokers often advertise on student websites or money-saving forums, university notice boards and marketplace websites. They may also try to sell insurance policies in pubs, clubs or bars, newsagents and car repair shops.
- Be wary of ghost brokers using only mobile phone or email as a way of contact. Ghost brokers have even been reported using messaging apps, including WhatsApp, Snapchat and Facebook. Fraudsters don’t want to be traced after they’ve taken your money.
- If you are not sure about the broker, check on the Financial Conduct Authority or the British Insurance Brokers’ Association website for a full list of all authorised insurance brokers: and .
- You can also contact the insurance company directly to verify the broker’s details.
- If you have information relating to a ghost broker you can report it confidentially to IFB's .
- You can check to see if your car is legitimately insured on the Motor Insurance Database website: .
Young motorists, including students, are typically trapped between high insurance costs and earning low wages meaning they may be easier to trick with "unbelievably" cheap deals.
The police also say that new drivers may not have a complete understanding of how insurance works.
One young driver, aged 18, reported a scam to Action Fraud after he was conned out of as much as £2,200.
Detective Superintendent Peter Ratcliffe said: "While offers of cheap car insurance may be tempting for students, purchasing car insurance through a ghost broker will end up costing you far more in the long run – both in terms of money and your licence."
Latest in frauds and scams
Drivers with poor credit scores are being warned not to fall for fake adverts for car leases on social media.
The deals offer vulnerable customers the chance to take out a policy for a car without a credit check or a deposit.
Conmen are also targeting victims of timeshare fraud with a second scam, which has already seen Brits conned out of £7million in seven months.
In addition, Brits are being warned to be aware of gift card fraud as new figures reveal that £6.5million was lost through the scam between April 1 2015 and March 31 2018.
One gentleman was told to buy £1,000 in iTunes gift cards by scammers impersonating HMRC.
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