Don’t get it ghosted! New drivers warned of rise in fake car insurance deals on social media
Young drivers are encouraged to watch out for bogus car insurance deals being sold online by fraudsters known as ‘Ghost Brokers’, which are on-the-rise and can leave victims out of pocket and facing criminal consequences for driving uninsured.
New figures released today by the Insurance Fraud Bureau (IFB) show the consumer con has grown by over 50% in the past two years. Ghost Brokers are increasingly advertising bogus deals on popular sites such as Facebook, Instagram, SnapChat and TikTok, and new drivers – including those insuring their first car and learners who need learner cover – are most at risk.
To help protect young drivers from this devastating issue, the ABI, City of London Police and the IFB, in association with the government’s ‘Stop! Think Fraud’ national campaign, have launched a campaign to raise awareness of the signs of Ghost Broking and encourage the public to report it to CheatLine. Ursula Jallow, Director at the IFB, 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.
“We’re proud to be supported by the Stop! Think Fraud national campaign, in partnership with the ABI and IFED, to bring attention to this issue.” Ghost Brokers are fraudsters pretending to be real insurance brokers.
They often promote their bogus deals through social media and sometimes on fake insurance company websites. They then encourage communications through encrypted messaging software like WhatsApp to keep illegal dealings in private.
The fraudsters will exploit the high costs young drivers face, along with their lack of experience when it comes to buying insurance, with promotions that feel irresistible to the public. This involves marketing themselves towards young social media users, promising to offer the lowest rate on the market - even if the driver has convictions - and offer up-front quotes, despite the fact insurance is meant to be priced based on the risk of the individual.
Insights also show that learner drivers who may need to insure a car that they are practicing in, are also being targeted with fraudulent deals. The policies are taken out using stolen details which belong to people who are cheaper to insure, which are then sold on at a reduced rate, or they may simply be a photoshopped piece of paper; in both instances, the policy is invalid and the victim is driving uninsured.
The scale and impact of the issue is vast with thousands of young people believed to be getting targeted by Ghost Brokers each day. A YouGov survey (commissioned by IFB) found one in five (18%) 18-24 year olds have used social media to search for car insurance.
Falling for a Ghost Broker’s deal has devastating consequences. Victims can lose hundreds and in some cases, thousands of pounds.
And they will be driving without valid insurance, which means they can have their car seized by police, receive 6 licence points, a £300 fine, and a court referral where they may get an unlimited fine and/or a driving ban.