Don’t Be a Victim of These Popular Insurance Scams

by Sean Bryant on March 28, 2013

Insurance ScamsAs much as we would like to believe that we live in a fair and honest world, with fair and honest people, who would never dream to deceiving consumers, it just isn’t the case.

Believe it, or not, deliberate deceptions can be found left and right, and the realm of insurance is no exception. You not only have to look out for crooked insurance companies, but crooked agents who work for a perfectly reputable insurance provider.

If you’re currently in the market to purchase an insurance policy, please be aware of the following insurance scams; they are the most prevalent and the most destructive!

1.     “Hi! I need to file a claim! … Hello? Is anyone there?”

Beware: When you stumble across an affordable insurance company, with exciting low rates that beat out everyone else in town, it kind of feels like winning the lottery. Unfortunately, sometimes, things are not as good as they look.

If you think it’s too good to be true, it probably is, and you might be dealing with an insurance company that only exists to take your premiums and then vanishes as soon as you call to file a claim!

Be Smart: Don’t sign anything until you’ve thoroughly checked out your prospective insurance company. Legally, they do not have the right to revoke a quote if you tell them you need time to check out their credentials. If they tell you there’s a time-limit, run!

2.     “Well… he seemed like a nice agent…”

Beware: Unscrupulous insurance agents exist within certified, reputable insurance companies, so even if you’ve already vetted the company, you still need to watch your back with the agent you’re working with.

What these agents do is pocket the premiums that you pay and never actually file any documentation on your behalf. Then, when you go to file a claim, the insurance company informs you that your policy was cancelled long ago due to non-payment, and the agent is long gone.

Be Smart: Be sure to make all checks payable to the actual insurance company and make sure that you receive a physical copy of all insurance materials associated with your contract.  You should receive these by mail within just a week or so.

Obviously, the best way to ensure you aren’t a victim is to only deal with a reputable insurance provider. Suncorp is one of Australias leading & most trusted insurance providers. You can click here to visit their site directly for more information on how to choose the right policy for you & your family.

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Sean Bryant

Sean Bryant created in 2011 to help pass along his knowledge of finance and economics to others. After graduating from the University of Iowa with a degree in economics he worked as a construction superintendent before jumping into the world of finance. Sean has worked on the trade desk for a commodities brokerage firm, he was a project manager for an investment research company and was a CDO analyst at a big bank. That being said he brings a good understanding of the finance field to the One Smart Dollar community. When not working Sean and he wife are avid world travelers. He enjoys spending time with his daughter Colette and dog Charlie.
  • It just seems that everyone is trying to make money and they don’t care how they will do it.

  • I wish these things weren’t true but scams happen all the time so best be careful and do your research!

  • You really have to do your homework and know your insurance policy inside and out. We were threatened a few years ago when we had a flood not by our insurance but the apartments insurance, it was a mess. I’m so glad we educated ourselves on our rights!

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