Young drivers have been warned about the rise of fake car insurance policies offered up by ‘ghost brokers’.
Ghost brokers are not real brokers but criminals who alter policies that make them appear cheap.
Younger people often become victims because they pay more for insurance and are only in their early years of dealing with financial matters.
Ghost brokers also use platforms like social media that are popular with youngsters to target their victims.
They lure people in with promises of cheap upfront quotes, despite insurance prices being based on the risk of the individual.
Policies are taken out using stolen details which belong to people who are cheaper to insure.
These are then sold on at an artificially-reduced rate, or are copied on to a piece of paper.
Criminals will often steal people’s personal information to use in other crimes, such as banking fraud.
A survey commissioned by the Insurance Fraud Bureau (IFB) by YouGov of more than 2,000 people found 18% of 18 to 24-year-olds have used social media to search for car insurance.
The Association of British Insurers (ABI), the City of London Police and the IFB are raising awareness about the dangers.
IFB director Ursula Jallow said: ‘New drivers are caught out by ghost brokers because they face higher premiums and have had less experience in purchasing insurance policies for themselves, which unfortunately means they are more likely to be attracted to car insurance deals that are too good to be true.
‘The impact is devastating. We’ve seen victims lose thousands of pounds, have their identities stolen, their confidence and self-esteem shattered, and, in some cases, they have even had their car seized for driving uninsured.
‘It’s really important that we spread the word to help protect young drivers from ghost brokers.’
Around 115,000 fraudulent motor insurance policies were found by the IFB in partnership with the insurance industry between 2023-24.
Ghost brokers are believed to be responsible for thousands of cases up and down the country.
How to tell if you are dealing with a ‘ghost broker’?
Here are some of the signs that you might be dealing with a ghost broker:
1. The policy may be unrealistically cheap, with an upfront quote.
2. The seller only wants to communicate in private direct messages on social media or WhatsApp.
3. The advert may look unprofessional.
4. The seller may not have a legitimate website, UK landline number or address.
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