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Cheap car insurance can be tempting, especially when premiums feel expensive. However, if a deal looks too good to be true, it may be a scam.
One common insurance scam is called ghost broking. This happens when fraudsters pretend to sell genuine insurance but provide fake, invalid or manipulated policies. The FCA has warned young drivers about ghost brokers selling bogus insurance through social media and messaging platforms.
Buying fake insurance can leave you unknowingly uninsured. This can lead to serious consequences, including fines, penalty points, vehicle seizure and problems when making a claim.
Ghost broking is when a person pretends to be an insurance broker or insurance seller but is not providing genuine cover.
A ghost broker may:
The customer may not realise anything is wrong until they are stopped by police, involved in an accident or try to make a claim.
Ghost brokers often advertise through:
A genuine insurance provider should have proper contact details, clear documents and official communication channels. Be cautious if everything is handled only through private messages.
Everyone wants to save money, but an unusually cheap quote can be a warning sign. If most quotes are much higher and one person offers a very low price, take extra care.
A cheaper price is not useful if the policy is fake or invalid.
A ghost broker may suggest changing your address, job title, mileage or driving history to reduce the price. This is dangerous.
If false information is used, the policy may be invalid. You may also be treated as uninsured.
Before paying, check whether the company or person is genuine. The FCA advises customers to check firms properly before dealing with them.
You should be able to find:
Be careful if someone asks you to send money directly to a personal bank account. This can be a warning sign.
A genuine insurance arrangement should provide proper payment confirmation and policy documents.
If you receive policy documents, check them carefully. You can contact the insurer using official contact details from the insurer’s website, not just the number provided by the seller.
Ask the insurer to confirm whether the policy exists and whether your details are correct.
Keep copies of:
These may be useful if you need to report a scam.
Do not choose car insurance only because it looks cheap. Make sure the seller is genuine, the policy details are accurate and the cover is valid before you pay.
What is ghost broking?
Ghost broking is a scam where fraudsters sell fake, invalid or manipulated insurance policies.
Who is most at risk?
Young drivers and drivers looking for cheaper premiums are often targeted, especially on social media.
Can fake insurance leave me uninsured?
Yes. If the policy is fake or invalid, you may be treated as uninsured.