Four Insurance Scams to Watch Out For

Premium Theft 

When you’re paying for insurance, you’re paying for the insurance company to provide you coverage in the event that you cause an accident due to negligence. When an insurance agent sells you car insurance, they’re supposed to send your money and information over to underwriting. However, in “premium theft” situations, instead of sending your payments onto the company, they keep the money for themselves and their personal use. You may be wondering, if the insurance agent is taking the money for themselves, who’s paying for insurance? The answer is that nobody is paying for insurance. Therefore, victims of premium theft don’t have insurance. One of the most unfortunate parts of premium theft is that the victims of this fraud don’t often know that they’re driving around uninsured. Once you get insurance, make sure that you get proof of insurance. In fact, it’s better not to drive until you have proof of insurance. 

Staged Accidents 

Sometimes, scammers stage accidents in order to cash in on an insurance payment. Typically, this involves intentionally causing accidents without a lot of evidence for either party. For example, the scammer may jump out as a pedestrian in front of a car. They may claim that the driver wasn’t paying attention and caused the accident.  Accidents like this one, without any bystanders, would be very “he said, she said” and it’d be difficult to prove that the pedestrian threw themselves in front of the car on purpose. These days many people have dash cams, doorbell cams, home security systems, and more. In 2024, someone is always watching. If you attempt to stage an accident in hopes of cashing in on a personal injury settlement, you might be facing some pretty big consequences when footage comes out showing how you attempted to stage an accident. 

Fake Accidents 

Similar to staged accidents, sometimes scammers will fake an accident. They’ll do this by taking your license number, the model and make of your car, and possibly even your location and the time you were at the location. They may claim that you hit their car and ran off. They’ll use the aforementioned information to file a claim with their insurance company. You may hear from their insurance company regarding the accident that you were never in to begin with. If this does happen, tell the insurance company who called you that you weren’t in an accident. You do not have to answer any more of their questions. After you’ve gotten off the phone with their insurance company, call your insurance company and let them know that someone is filing a claim against you for an accident that you were not involved in. Let the insurance company advise you regarding what you should do next. 

False Agents/Ghost Brokers 

Not everyone who’s selling insurance is actually an insurance agent. False agents, otherwise known as ghost brokers, are people who pretend to be insurance agents in order to convince others to buy insurance from them. The problem is that they aren’t really selling insurance—they’re just taking your money. Furthermore, these false agents do not actually work for an insurance company either. You can avoid buying insurance from a ghost broker or false agent by confirming that the insurance is indeed licensed to sell insurance in your state. Remember, an agent should never ask for cash-only payment. If you do purchase insurance, make sure that you get proof of insurance before you start driving. 

Protect Yourself Against Scams 

Make sure you purchase insurance from a legitimate agent before you sign anything or give them any money. Once you purchase insurance, don’t drive until you have proof that you’re insured. With the invention of today’s technology, you should receive proof almost instantly. If you receive a call from an insurance company regarding an accident you weren’t involved in, make sure that you’re talking to an actual insurance adjuster who really does work for that company. Lastly, it may be a good idea to invest in a dash cam. If you have been injured by the negligence of another person and you need help getting the compensation you need to recover from the injuries you’ve sustained in the accident, Moxie Law Group is here for you. Contact us today to get started on your free consultation.