Ghost broker scam: thousands of drivers may have fake car insurance

Unsuspecting motorists are leaving themselves uninsured after buying fake insurance through online ghost brokers – thousands conned across the UK


Drivers aged 17-24 are most likely to be caught out by ghost brokers, according to a new report by City of London Police.

Fears thousands of motorists are unwittingly driving around uninsured have been raised by the police force who've launched the second phase of their #SteerClearOfFraud campaign to help educate drivers on ghost broking scams.

From November 2014-July 2018, most of the reports came from victims aged 17-24. Victims lost a total of £164,993, or an average of £912 each. 

What is a ghost broker?

Criminals who sell fake car insurance policies to unsuspecting drivers are known as ghost brokers; they carry out the fraudulent act in one of three ways:

  1. Forging insurance documents
  2. Falsifying a driver’s details to lower insurance costs
  3. Take out a genuine insurance policy then quickly cancelling and claiming the refund as well as the victim’s money.

The UK’s Insurance Fraud Bureau (IFB) warns the policies aren’t worth the paper they’re written on if a driver ever needs to make a claim.

The City of London Police’s latest report shows drivers aged 17-24 are most likely to be targeted in these scams with many of the ghost brokers reaching out through social media channels such as Facebook and Instagram.

The conmen also run newspaper and magazine adverts, cold call customers and will get friends, family members or work colleagues to introduce them to people.

The #SteerClearOfFraud campaign aims to teach drivers to be wary of heavily discounted prices on the internet or cheap prices they’re offered directly for car insurance.

How to avoid a ghost broker

There are a few things you can do to avoid falling foul of a ghost broker. 

  • Buy insurance directly from an insurance company’s website. If you want to use a broker, visit the British Insurance Brokers' Association website and check the broker is FCA registered
  • Check the insurance provider is a member of Motor Insurers' Bureau (MIB)
  • Be cautious of brokers trying to sell insurance through social media, newsagents and bars
  • Trust your instinct – if an offer looks too good to be true, it probably is
  • Be wary of insurance brokers who only use a mobile phone or email to contact you
  • If you suspect a ghost broker is trying to contact you, call the fraud bureau on 0800 422 0421.

For more information on these types of scams, read our guide on how to spot a ghost broker and check out the advice from the City of London Police