The number of ghost broking scams, in which fraudsters sell fake or invalid car insurance policies, has increased by 30% over the past five years, according to report by Sky News.
Victims often believe they are purchasing legitimate policies, only to find themselves uninsured and at risk of financial losses and legal consequences.
Ghost brokers operate by selling falsified insurance policies, manipulating details to obtain cheaper premiums, or taking out policies and cancelling them soon after. Many advertise through social media platforms, targeting individuals looking for lower insurance costs, particularly young drivers.
According to Sky News, nearly half of young drivers cite insurance costs as a major concern, making them a key demographic for these scams.
Victims typically realise they have been scammed only when attempting to make a claim or after being stopped by police. Many receive professional-looking insurance documents that appear legitimate, sometimes even convincing law enforcement officers during routine checks. However, when they contact the insurance provider, they find that no valid policy exists in their name.
In 2024, victims of ghost broking lost an average of £2,206. Beyond financial losses, individuals caught driving without valid insurance can face fines, penalty points on their licence, and potential criminal charges. Additionally, those involved in accidents must cover repair costs themselves.
Detective superintendent Tom Hill, who leads the City of London Police’s insurance fraud enforcement department, said social media has played a significant role in the rise of ghost broking cases. He noted that the low barriers to creating accounts allow fraudsters to advertise widely and reach unsuspecting buyers.
"Do your research and make sure you're dealing with a genuine broker or genuine insurance company. If the conversation has been moved on to WhatsApp, for example, alarm bells should be ringing," he warned.
Authorities advise motorists to verify insurance providers through official channels and be cautious of policies that appear significantly cheaper than standard rates.
With reports of ghost broking continuing to rise, what steps can drivers take to protect themselves from these scams? Share your thoughts in the comments.
