New drivers in the UK have been issued a warning of car insurance scams circulating on social media.
Cash-strapped drivers are being urged to exercise caution when finding bogus car insurance “deals” online.
The Insurance Fraud Bureau (IFB) issued the warning as thousands of learner drivers prepare to pass their test amid a backlog of tests due to the coronavirus pandemic.
Scams include “ghost broking”, where fraudsters pretend to be insurance brokers to sell unrealistically cheap and fake policies, often to younger drivers.
The IFB warned new drivers could be paying out hundreds of pounds on what in reality is nothing more than a photoshopped piece of paper.
The Bureau warned that scammers even use stolen personal information to take out policies which are then doctored before being sold on.
Victims will find they are uninsured when they come to claim for an accident which can lead to thousands of pounds in costs and even six points on their driving licence.
They may also face court, where they might receive an unlimited fine and a driving ban.
The IFB warned the scam could even affect job prospects if drivers are left with an uninsured driving conviction on their records.
Stephen Dalton, head of intelligence and investigations at the IFB said: “The last thing new drivers need right now is to risk losing their car for no insurance because they’ve been duped by a scammer on social media.
“Drivers must carry out basic checks to make sure they’re buying car insurance through a trusted provider, or they’ll be making a very expensive mistake.
“I encourage anyone who’s seen evidence of an insurance scam to report it to the IFB’s confidential Cheatline online or on 0800 422 0421.”
Mark Magee, head of driver policy at the Driver and Vehicle Standards Agency (DVSA) said: “As well as ensuring you have the skills, knowledge and understanding attitude to drive safely, having valid insurance is of the utmost importance when you drive on your own.
“Check to make sure insurance brokers are genuine before parting with your money.”
Tips to avoid bogus car insurance deals
The IFB has shared tips to avoid bogus car insurance deals:
- Avoid deals on social media or messaging apps and only purchase car insurance through reputable sellers.
- If buying through an insurance broker, check the seller is registered with the British Insurance Brokers’ Association (Biba).
- If buying directly through an insurer they should appear as a registered member of the Motor Insurers’ Bureau (MIB).
- Checks can also be made to see if insurance advisers are registered with the Financial Conduct Authority (FCA).
- The IFB’s Cheatline can be contacted online or by phone on 0800 422 0421.
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