You are here: Home - Insurance - News -

Dirt cheap car cover? You could be a victim of ‘ghost broking’

0
Written by: Paloma Kubiak
22/05/2018
If you've been offered a suspiciously cheap car insurance deal and had to pay cash upfront, it’s likely you’ve fallen victim to ‘ghost broking’.

‘Ghost broking’ usually targets car owners who have been refused credit elsewhere or who may struggle to be accepted for pay monthly premium cover.

As people search online for cover they can afford on a monthly credit basis, they may stumble across sites offering a cheap deal as long as they can stump up cash in advance.

However, the ‘insurer’ or ‘broker’ uses stolen or cloned credit cards and ID to buy the cover on behalf of the car owner. The driver is noted on the policy as a named driver, they’re given the motor insurance certificate and they’re legally covered, but once the credit card is reported as stolen, the insurance company will cancel the policy.

As a result, the driver is unaware they’re uninsured, which means they’ll face problems in the event of an accident or claim. Most often, they’re stopped by police as the vehicle is flagged as uninsured.

Smartdriverclub Insurance, a telematics insurance provider, has seen a 14% increase in ‘ghost broking’ in the first-quarter of 2018.

It suggests the rise is being fueled by recent regulations which have made getting credit tougher, pushing more people online in the search for an affordable deal.

Given the rise in ‘ghost broking’, Smartdriverclub Insurance warns drivers to be on guard for car insurance offers at cheap prices, in return for cash.

Penny Searles, CEO of Smartdriverclub, said: “As premium levels have soared, ‘ghost broking’ has become a real challenge and a real risk for unsuspecting motorists.  The insurance cover will be cancelled once it’s identified as fraudulent leaving the motorist out of pocket and without insurance.

“The worst case scenario is that an accident occurs leaving the motorist high and dry because the cover will be found to be invalid.

“It is relatively easy for someone to set up a policy using a stolen identity and using the purchaser of the policy as the named driver.  As soon as we identify that the policy has been ghost brokered, we cancel the cover but by this point the fraudster has the motor insurance certificate and can pass this on to the innocent motorist.”

Searles added that the issue needs a concerted approach by the insurance sector to stop this racket “so that we can protect innocent motorists from the risk of invalid motor insurance”.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

YourMoney.com Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
2263826-data-security-padlock
Warning: scammers using GDPR emails to steal your data

With the introduction of the General Data Protection Regulation (GDPR) this week, fraudsters are jumping on the bandwagon in the...

Close