Beware: 3 Regularly Occurring Insurance Scams

Deliberate deceptions with the purpose of unlawfully receiving illegitimate gain can occur not only with the insured attempting to collect on their policy, but with unscrupulous insurance companies and agents, as well. If it’s your intention to purchase any kind of insurance policy, you should always play it smart, and that starts with being aware of the three most common insurance scams.

Empty Desk1. Beware Insurance Companies That Don’t Actually Exist
Have you found an insurance company that is offering rates that seem too good to be true? Well, they probably are. While there are plenty of smaller, completely legitimate, insurance companies operating, there are also plenty who aren’t actually companies at all. These fake insurance companies often offer a rate that beats out all of the major company’s rates by a landslide, but they suddenly disappear once you pay your premiums.

How to Not Be a Victim
Refrain from signing on the dotted line until you’ve thoroughly vetted the insurance company providing your policy. It is within your full legal right to take the time you need to do this, so if the company is pressuring you, or threatening a time-lapse on the deal they’ve offered, this is a red flag! Always contact your state insurance department and ask them to share the insurance company’s licensing information with you.

2. Beware Bad Insurance Agents at Legitimate Insurance Companies
Even if you’ve thoroughly vetted your insurance company, you still run the risk of running up on hard luck with your insurance agent being crooked. These unscrupulous agents will intercept your payments, pocket your premiums, and never prepare any documentation that the payment was ever made to the insurance company. Then, when tragedy strikes and you need to make a claim, you can’t. Why? Because your policy was cancelled long ago due to non-payment.

How to Not Be a Victim
Make certain that you always receive a copy of your policy and an insurance ID card for any transaction you make in purchasing an insurance policy. These usually arrive by mail and should do so in a timely manner after you make your purchase. Also, always make checks payable to the insurance company, not the agent.

3. Beware of Pedestrians!
Of course, not all pedestrians are bad, but the ones who deliberately jump in front of your car, or stand as fake “witnesses” to a planned car accident, surely are. Believe it, or not, these deliberate car accidents take place all the time and these individuals drawing the blueprints don’t care whether they cause serious injuries, or even deaths—they just want to take the
money your insurance company pays out to cover the accident.

How to Not Be a Victim
It’s a general rule of driving to stay at a safe distance when driving behind other cars, but this scam provides even further motivation to do so. If you do wind up in some kind of accident where you do not believe to be at fault, go with your gut. Report any suspicious activity to both the officer writing the report and to your insurance company; while it might be a legitimate accident, it’s always a good idea to play it safe.

Insurance can be a tricky undertaking if you’re not familiar with how it works. Always use a trusted provider, like Suncorp,, to ensure you’re not in for any unwanted surprises! To find out more about how Suncorp can help you avoid a sticky situation click here.