New form of motor insurance fraud – beware

The BBC reported on it’s website last week about a new form of fraud, which takes advantage of the fact the car insurance costs have significantly risen recently (ironically at least partly because of a high occurrence of personal injury fraud), the gfact that young drivers are particularly hard hit by these costs and the “gotta have it” culture which results in people taking risks.

The 2 forms of the fraud, collectively described as “ghost broking” in essence are :-

• Online scams from people holding themselves out as insurers or brokers, which is akin to boiler room fraud with shares – websites can be set up quickly and anonymously and taken down quickly as well
• Scam brokers claiming they can get discounted insurance through internal connections, insisting on a sizeable upfront payment – they then give false information to the insurers such as that the applicant is a lot older, has a no claims history, works in a different profession.

Axa, one of the biggest UK insurers has apparently estimated that 20,000 motorists may be driving with  fraudulent insurance policies.

Have you been the victim of this type of fraud ? Do you have a view on it ? Let us know.