Car insurance brokers: Should you use one?

A ghost broker is a fraudster who poses as a legitimate insurance broker to deceive you into purchasing a fake or invalid car insurance policy. These dishonest individuals or groups use various tactics to make their scams appear as genuine as possible, taking money from unsuspecting victims and leaving them without valid insurance coverage.
Known ghost broking scams include:

• Real policies with fake details: Ghost brokers may purchase genuine policies from legitimate insurance providers using false details. Once the policy is secured, they then sell these policies to customers. Because the policy is registered with false information, it becomes invalid for the buyer
• Selling fake policy documents: Some ghost brokers design and produce fake policy documents that look genuine. They then sell these to customers as if they are from legitimate insurance providers, when in reality, they offer no actual coverage
• Policy cancellation after payment: In some cases, a ghost broker might set up a genuine policy and then ask the customer to pay the premium. Once the payment is received, the broker cancels the policy and pockets the refund, leaving the customer without any insurance

If you become a victim of a ghost broking scam, not only do you lose money, but you’re  left without valid insurance. Driving without valid insurance is illegal and can result in several penalties:

• You could face substantial fines
• You might receive penalty points on your driving licence
• In some cases, your vehicle can be seized or even destroyed
• It can lead to increased future insurance premiums because of the lapse in coverage or penalty points

How to avoid ghost broking scams

To avoid ghost broking scams, you should:

1. Beware of their selling tactics: ghost brokers often operate on platforms where they can remain anonymous. Be cautious if a broker approaches you solely through social media, messaging apps, or unsolicited emails. Try to meet them in person or at least have a video call with them. This isn’t foolproof but can act as a deterrent for many fraudsters
2. Ask for their credentials: before conducting any business, check if the broker is registered with the FCA and BIBA
3. Monitor their processes and guarantees: genuine brokers have clear and well-documented processes. If a broker makes an exceptionally cheap offer, rushes you into making decisions, or is vague about the details, tread carefully. An absence of formal documentation or lack of transparency in their dealings can be red flags

If you suspect you’re a victim of ghost broking, it’s essential to act swiftly. 

• Report the scam on the Action Fraud website, or ring them on 0300 123 2040
• Make a report on the Insurance Fraud Bureau’s website, or call them on 0800 422 0421 

Finding a car insurance broker near you can be straightforward with the right approach. You’ll want a broker who understands your needs and can provide you with the best options available.

A simple online search can yield beneficial results, and you’ll likely be provided with a range of options in your vicinity. From there, you can visit the broker’s website, learn about their services, and possibly even book an appointment.

One of the most common ways to find a broker is through BIBA. They have lists of approved car insurance brokers, allowing you to search for one near you.

Another helpful method is reading trusted reviews. Websites such as Trustpilot or Google Reviews can provide insights from other consumers who have interacted with brokers. By reading about their experiences, you can understand which brokers are reliable, professional, and customer-focused. 

It’s essential to engage with a broker you feel comfortable with and who understands your needs. Speaking with a few different brokers before settling on one is always a good idea, so you’re confident in your choice.