Skip to main content

Insurance fraud is affecting YOU

Consumer Editor of Bennetts BikeSocial



Beware of the new car and bike insurance scam


Some car and motorcycle insurance prices have seen significant increases over the last several months for many reasons, not least parts costs, high value car crime and rocketing personal injury claims, but fraud is also having a major impact, with one common scam making up a large proportion of that.

The City of London police warned riders and drivers to be vigilant after ‘ghost broking’, which sees fraudulent policies sold to unsuspecting road users, left potentially thousands unknowingly driving or riding on our roads without genuine insurance.

Motorcycle and car owners are being targeted through adverts on social media, money-saving forums and student websites, with advertisements from the crooks even appearing in pubs, clubs, newsagents and repair shops.


How do these car and bike insurance scams work?

One way that riders are being scammed is through the crooks posing as brokers working for established insurance companies contacting potential ‘customers’ directly, who are offered an insurance quote that could potentially save them a lot of money on an annual policy. After handing over hundreds and even thousands of pounds, the ‘customers’ are issued with forged documents.

Other fraudsters take out genuine policies on the customers’ behalf, then cancel these policies and claim the refunds for themselves, as well as keeping the money from the victims – this fraud is what's know as 'ghost broking', and it's having a big impact: one convicted scammer was found to have set up a total of 133 fake insurance policies worth £90,000, with a further £60,000 being scammed before he was arrested.

These insurance policies are worthless as they're cancelled, but some unfortunate drivers and riders have only found out about the scam when they were involved in an accident and left footing the entire bill, which can run into many tens of thousands of pounds.

This scam is also costing every rider and driver in increased policy prices as the brokers are landed with bad debt and – in the case of policies fraudulently purchased through price comparison sites – the fees charged for the initial introduction. With some insurance brokers reporting as much as 6% of their business being made up of fraudulent activity, it's not hard to understand the impact this can have on everyone's policy prices.

Detective Chief Inspector Andy Fyfe of the City of London Police said: “Ghost brokers trick unsuspecting victims with offers of heavily-discounted vehicle insurance, leaving them with a policy that isn’t worth the paper it’s written on, and open to the severe harm that comes from driving without valid insurance.”


Beware of Ghost Brokers selling scam car and motorcycle insurance

The rise of ‘ghost brokers’ has been fuelled by increases in the cost of genuine insurance premiums. Regulatory and market changes back in 2017 saw the underlying cost of many underwriters’ policies increase by around 15%. In addition to this, the government upped Insurance Premium Tax by a further 2-12%, so combined with the increasing price of claims due to parts cost, inflation and personal injury, many buyers have been lured with the promise of being able to slash their quotes from sometimes thousands of pounds to as little as £100.

Fraudsters continue to post messages on social media, and have even been known to pay for Facebook ads, with ‘cover’ offered at temptingly low rates, so for your own safety, when shopping around for insurance, deal direct with brands you trust either by phone or via the company's website, or through established price comparison sites.

Driving without valid vehicle insurance is a crime that carries a hefty penalty so Police warn all customers looking for car or motorcycle insurance to be vigilant. Remember, if an offer seems too good to be true, it most often is.

To ensure your vehicle is legally insured, visit the Motor Insurance Database to perform a free insurance check of your own vehicle at

If you'd like to discuss this or any other Bennetts BikeSocial article, join us on our Facebook group.