How to Avoid Auto Insurance Fraud
Unfortunately, we live in a world of folks who are out to take advantage of others, and the realm of auto insurance is no exception. While you might thing that buying auto insurance is always a safe and easy transaction, the fact of the matter is that there are scammers out there who want to take advantage of your need for insurance. Auto insurance is a big business with a tremendous amount of money involved, so it’s only natural that criminals would pick this area to target.
When you’re buying auto insurance, you need to be careful. Thankfully, there are a few things you can do to make sure you don’t get taken advantage of:
- Watch out for unsolicited offers. For the most part, reputable auto insurance companies don’t show up on your doorstep unannounced or call you on the phone out of the blue. You should always be careful with unsolicited insurance offers.
- Low prices can be a sign of fraud. If the price for auto insurance is significantly lower than every other company out there, be careful. It could be a scam, or it could be that the coverage has a ton of exclusions that you won’t find out about until you need to use it.
- Check with the state’s insurance department to make sure they’re legitimate. Most states have an insurance bureau or similar program through which insurance agents and insurance companies have to be licensed.
- Research the company. Check with the Better Business Bureau and see how the company is rated, and whether they have complaints against them.
- Look for collusion. If the insurance agent has investments or ownership in car repair shops, this should be a warning flag.
- Protect your insurance information. Your auto insurance account numbers should be guarded as well as you guard your bank account numbers. If a criminal gets ahold of that information, they can use it for nefarious purposes, such as identity theft.
By taking these few simple precautions, you’ll save yourself the headache, time and frustration that comes from being ripped off by scam artists or unethical insurance companies or agents.
