How To Stop An Insurance Scam

Insurance scams could range anywhere from a nuisance to devastating levels. Everyone needs a policy, so this is what makes insurance fraud so prevalent.

Avoiding insurance scams is about preventative measures and recognizing a scheme when you see one. If you’re worried about deceptive practices when it comes to insurance, we’ve got a guide to avoiding and reporting them and hopefully stopping them in their tracks.

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What Can An Insurance Scam Look Like?

In general, insurance scams are someone attempting to sell you “insurance,” especially life insurance, wherein you will be putting into a pot that you will have no access to. Instead, this pot will be serving to bankroll someone’s lifestyle rather than being used to safeguard an element of your life or retirement fund.

This can come in various forms. It’s rare to get face-to-face insurance scammers anymore, as that is a level of risk they don’t need to deal with anymore. Instead, you might be contacted via text, email, or phone calls. Even worse, the goal might not be to gain a rolling amount of money from you, but perhaps your passwords and bank details so that they can grab as much of your money as possible before you catch on.

How To Avoid An Insurance Scam

It’s worth pointing out that genuine insurers, like Lemonade’s home insurance, simply don’t call up anymore for new customers. Customers tend to find insurers via comparison websites or traditional advertising methods that don’t include getting in touch with the individual, so if someone is calling you, claiming to be an insurer with a brilliant deal, they’re scamming you. If you want a new agreement on your insurance, you must contact them.

Even if you believe that they are from an insurance company, ask them their name and tell them you’ll call them back and ask for them. Call the company number on their business website or the Yellow Pages supplies rather than the mobile or overseas number they are probably calling with.

So, hanging up on anyone claiming to be an insurer covers phone calls, but what about texts? Well, that is simple. No one is selling something as important as an insurance policy via text. However, they might gain access to your phone via a link in the text. Even opening the text might allow them access, so don’t open it, and delete it as soon as possible.

Once you are a customer, you might gain some SMS notifications, but they will be primarily for marketing purposes. Be wary of them and be sure that they have a goal by following the link. If they simply show a better deal, look the deal up in Google rather than following the link.

The same goes for emails. A newsletter will have graphics and visuals, whereas a scam might be a few words of broken English text. However, some of them can look very plausible. Be aware of any links you are asked to click, and if you’re not sure, the best idea is to ignore them and call the company directly.

What Should You Do If You Get Scammed?

If you think you have been scammed, contact your insurer right away. For one thing, they can confirm whether you have the policy you’ve signed up for in their records, and for another, your personal details might be compromised, and your insurer will have to safeguard your current policies with them.

Update all your passwords so that your scammers can get no further in gaining information, update your anti-virus software and contact your bank. Let your bank know that your details have been compromised, and they can look out for any suspicious activity and shut down your finances if needs be.

There are preventative measures you can take as well. Register with a credit reference agency like Experian or Transunion or a fraud protection service, which will identify any policies and other financial agreements that have been taken out in your name.

Check the Office of the Comptroller of the Currency register for the financial firm claiming to exist. If you don’t find them on the register, you might find them on the warning list.

Report any suspected phishing scams to the government and call a hotline if you get a suspicious call.

How To Report an Insurance Scammer

Let your friends and family know about this insurance related article on your social media. You can also officially report insurance scammers and any other suspicious activities to FTC ( Federal Trade Commission) using the following link:

Report To The FTC Here

How To Protect Yourself More

If you want to be notified about the most notorious scams regularly, subscribe to the Scam Detector newsletter here. You'll receive periodic emails – we promise not to spam.

Meanwhile, educate yourself with some other insurance scams right under this paragraph. Last but not least, feel free to use the comments section below to expose other scammers.

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