Quick Tips For Avoiding Insurance Scams When Buying Online



Because so many people are now shopping for insurance online, it has opened up a pernicious, widespread illegal industry perpetrating insurance scams. These insurance scams are currently affecting every facet of the insurance market, including life, health, auto, long-term, accident, homeowners, renters, mortgage and even pet insurance. 

Many fall for scams trying to save money by getting cheap insurance and end up losing everything. Having insurance that doesn’t pay on a legitimate claim is worse than having no insurance at all. Not only did you waste your money on the bogus policy, but you also lived with the expectation that you were covered, at least up until the time your claim was made. The problem is pervasive. Recently, in Texas alone, the Department of Insurance closed down 129 unauthorized ‘insurance companies’ and their agents. The illegal machinations of these companies affected more than 20,000 people.

In Florida, almost 30,000 people, including many senior citizens, have been scammed on their medical insurance coverage and left holding the bag for millions in unpaid medical claims. Similar insurance scams have affected victims in every state and with so many now opting to buy their insurance online; it’s become even easier for the unscrupulous to perpetrate their dirty deeds. To prevent the potential of becoming a victim yourself there are a few things you can and should do.

Avoid Insurance Scams When Buying Online Insurance

Everyone has heard the old adage, “If it sounds too good to be true it probably is.” With this in mind, education is a big key in protecting oneself from an insurance scam. Do some comparison-shopping to get an idea of what policies offering similar benefits generally sell for. While no two policies will be the same and premium costs vary from one company to the next, a significantly cut-rate price should set off some warnings. In this case, do some in-depth research on the company making the offering. Check reviews, look at their financial standing through A.M. Best Company or check with the State Department of Insurance.

Most insurance scams pretending to sell insurance online look legitimate. Some will offer to provide a free quote but ask for information that isn’t required for a simple quote. In some cases, they are phishing for stealing your identity.

One way to put yourself at ease when buying insurance online is to deal with well-known, nationally recognized carriers. If you’re considering dealing with a company not familiar to you, it’s important to do a background check on them, which can be easily accomplished online. If you have any doubts, go somewhere else. It’s just not worth the risk.

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