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Aug 28, 2024 · Insurance scams are deceptive practices that can cost victims significant financial losses and emotional distress. These fraudulent schemes target unsuspecting individuals and businesses, exploiting their trust in the insurance system.
Sep 26, 2023 · Life insurance policy fraud is when scammers trick people into believing they're buying insurance coverage, or receiving proceeds, from a legitimate company when they're not. Instead, the vendors are out to steal your money or personal information or both.
- Phony Contacts
- Beneficiary Scam
- Premium Diversion
- Phony Policies
- Fee Churning
- Forgery
- Policy Switching
- Overselling
What it means: Fraudsters may contact you by email, phone or text messageusing a false identity to request money or personal information. They may say there's a problem with your existing life insu...How to avoid the scam: Don't click on suspicious links or attachments in a text or email. Review any communications carefully for misspellings or odd email addresses that could be signs of a scam....What it means:Scammers may say you were named as the beneficiary on the life insurance policy of someone who has recently passed, but that an outstanding premium balance is preventing them from iss...How to avoid the scam: Don't give out any personal information or make a payment. Check with your state insurance department; if the insurance company is legitimate, contact them directly using the...What it means:Insurance agents pocket your premium payments instead of paying the insurance company.How to avoid the scam: Be wary if an insurance agent asks for payment to their name personally, payment sent to a P.O. Box, or payment by wire transfer, gift card, prepaid card or money order.What it means: Fraudsters sell phony insurance policies without a license and keep the premiums.How to avoid the scam: Before purchasing insurance, check with your state insurance departmentto make sure the company and agent are licensed.What it means:Shady insurance agents use cash bonuses to encourage you to use the cash value of your permanent life insurance to buy more insurance or switch policies. They'll earn a commission on...How to avoid the scam: Don't change your permanent life insurance policy without fully understanding costs, restrictions and benefits. Ask if the insurance agent receives a commission from the prod...What it means:Insurance agents may forge your signature to get into your account and change the beneficiary or access other linked accounts.How to avoid the scam: Work only with licensed insurance agents. Review your policy details annually to make sure no changes have been made without your consent.What it means: Insurance scammers lure you in with offers to reduce your premiums, then switch you to a policy with lower coverage. They may even switch your permanent life insurance policyto a che...How to avoid the scam: Never agree to a change in your policy without getting the details in writing. Before making major changes to your retirement plan, you might want to enlist expert help from...What it means: Agents sell you insurance add-ons you don't want, such as an accidental death benefit (sometimes called double indemnity), which increases the insurance payout if you die due to an a...How to avoid the scam: A licensed, trusted insurance agent can help you decide how much insurance you need, and accurately assess likely risks. Before buying any policy, understand its limitations...- Contact your insurance company if a stranger tries to steer you to an unknown body shop, doctor, chiropractor or legal representative.
- See only medical and legal professionals you know and trust, or who are recommended by people you trust. a. Contact medical and legal licensing regulators in your province to ensure that your service providers are licensed and that no complaints have been lodged against them.
- Be involved in your claim. Compare your records against the statements you receive from your insurance company to make sure the bills are accurate and don't include goods or services you didn't receive.
- Never sign a blank insurance claim form.
- Louis Denicola
- AI-Powered Scams. Perhaps the most obvious example of scammers using new technology to power existing scams comes from artificial intelligence (AI). For example, scammers might use AI to
- Student Loan Forgiveness Scams. The back-and-forth changes in student loan forgiveness creates a ripe opportunity for scammers. The scammers know people want to believe their student loans will be forgiven, and they'll use that hope for their personal gains.
- Phone Scams. Scammers may contact you by phone, and some phone scams rely on smartphones' capabilities to access the internet and install malware. These can include
- Zelle Scams. Scammers are turning to Zelle, a peer-to-peer payment app, to steal people's money. The scammer might email, text or call you pretending to work for your bank or credit union's fraud department.
While insurance companies do everything they can to avoid getting scammed by policyholders looking to make money without a legitimate claim, honest and trusting people also need to be wary of...
We surveyed 111 Which? members who'd experienced insurance fraud in the last five years, and found identity theft, induced accidents and false claims were most common. Read on to find out more about the key types of insurance fraud, and the steps you can take to protect yourself.
