‘Ghost brokers’ selling false policies could leave thousands of drivers uninsured

Thousands of motorists could be driving around uninsured, having bought bogus insurance policies by ‘ghost brokers.'

Fraudsters approach victims offering cut-price car insurance, but are in fact selling phony policies, leaving the buyer under the impression that they’ve bought legitimate cover.

More than 850 cases were reported to Action Fraud between November 2014 and October 2017, totalling losses of £631,000 for those affected – an average of £769 per victim.

Of the reported cases, 417 have resulted in action being taken against offenders, but the number of unreported incidents is believed to be much higher, causing fears that many drivers could be unaware that their vehicle is uninsured.

>> How much should you be paying for car insurance?

Fraudsters typically employ three methods: forging insurance documents, falsifying the driver’s details to bring the price down or taking out a genuine policy, and quickly cancelling it, claiming the refund along with the victim’s money.

“While an offer of cheap car insurance may seem tempting, falling victim to ghost broking will end up costing you far more in the long run – both in terms of money and your licence”

Men between the ages of 20 and 29 are the most likely targets, according to the City of London Police’s Insurance Fraud Enforcement Department (IFED), which has launched a national awareness campaign to warn motorists about ghost brokers. 

Perpetrators are most likely to make initial contact via social media, particularly Facebook or Instagram, but they are also known to cold called victims, be introduced by friends, family members or colleagues and place advertisements in newspapers and magazines.

>> Insurance premiums rise to record high

It added that, in addition to losing money by purchasing a counterfeit policy, drivers found to have invalid insurance are still liable for the associated offences, including a fine, points on their licence, vehicle seizure and claims costs if they are involved in an accident.

"Ghost brokers trick unsuspecting victims with offers of heavily discounted car insurance, leaving them with a policy that isn’t worth the paper it’s written on and open to the severe harm that comes with driving without valid insurance," said detective chief inspector Andy Fyfe, head of the City of London Police’s Insurance Fraud Enforcement Department.

"While an offer of cheap car insurance may seem tempting, falling victim to ghost broking will end up costing you far more in the long run – both in terms of money and your licence."

To report a ghost broker, contact the IFED on 0207 164 8200 or IFEDIntel@cityoflondon.pnn.police.uk

Alternatively, call Action Fraud on 0300 123 2040 or report it to the Insurance Fraud Bureau’s Cheatline by completing its online form or by calling 0800 422 0421.