How to Avoid a Cheap Auto Insurance Scam

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How to Avoid a Cheap Auto Insurance Scam

See how we're different

When it comes to getting the best deal for your auto insurance, you need to pay attention to the details, no seriously!

Cheap auto insurance scams are actually quite common on the internet nowadays.

You could end up with a scam policy that won’t do you any good if you get into an accident incident with your vehicle.

Common Auto Insurance Scams


Insurance scams can come from an actual insurance agent or a fake agent. These individuals may offer you car insurance at extremely low rates or car insurance you don’t want or need in order to inflate their commissions.


1. The Robo-Call Scam


You’re sitting at home when your phone rings. When you answer, it’s a voice explaining that you’ve been chosen to receive incredibly cheap car insurance due to your impeccable driving record. All you have to do is provide your personal information.

We shouldn’t be the one to tell you this but just in case, if someone calls you and wants your personal information, you should always hang up!


2. The Fake Agent



You’re looking for cheap car insurance, and you come across an agent’s ad for ultra-cheap auto insurance. You click on the ad, and it takes you to the insurance agent’s website where you blindly apply for the coverage and agree to pay a certain amount each month for that coverage.

If the agent is fake, your premiums are going directly into his or her pocket, and you won’t know it’s fake until you call to make a claim.


3. The Unethical Insurance Agent


Many insurance agents are professional and ethical, but a few are not. These agents may artificially inflate your premiums in order to pocket the excess, or they may add coverages onto your policy that you didn’t ask for in order to increase their commission.

They may even recommend changing your insurance policy to a different, more expensive policy because it “offers better coverage.”


4. The Ultra-Cheap Insurance Policy


If a car insurance policy sounds amazingly good, you should be extremely skeptical.


If it is a legitimate policy, it may not meet your state’s minimum requirements, which could leave you underinsured and liable for being sued if you get into a car accident that is determined to be your fault.


If you come across any of these scenarios, you should immediately screen the calls or block the phone numbers and report them. Reporting the incident flags the number so that they can be investigated, taken out of business and potentially criminally prosecuted.


How To Avoid Auto Insurance Scams


Avoiding insurance scams involves being vigilant and refusing to provide your information to someone who you did not call. You should also only view insurance policies from reputable insurance carriers.

  • Never provide information to an unsolicited caller – If a company or person calls you, never provide your personal information, especially if you are not actively shopping for car insurance.
  • Be wary of clicking on online insurance ads – The advertisement may look legitimate, but you are better off locating the insurance company and agent via an Internet search rather than clicking on the ad.
  • Research the agent – Even if the agent does work for the stated insurance company, he or she may not be ethical. Always research the company and the specific agent before purchasing a policy.
  • Research the insurance company – If you’ve never heard of the insurance company, it’s best to do your research to find out if they are licensed and legally allowed to operate within your state. You can accomplish this by looking on your state’s insurance department’s website.
  • Never agree to purchase super cheap insurance – If the cost of the insurance policy is 90 percent below average, there’s a good chance the policy is either fake or doesn’t cover what you think it covers. Always read the details of the policy.


Getting a New Policy from a Reputable Insurance Company


Rather than going to 15 different insurance websites and filling out quote forms on each site, we recommend using a local insurance agency. When you do business with a local insurance agency you will have the assurance knowing that your insurance needs are handled in a legal manner.

If you want to go above and beyond in your search, review the company and insurance agent’s ratings with your local Better Business Bureau and read their online reviews.

To compare car insurance rates from top companies in your area, start here!

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Pawson Insurance | Legal Disclaimer |

 Informational statements regarding insurance coverage are for general description purposes only. These statements do not amend, modify or supplement any insurance policy. Consult the actual policy or your agent for details regarding terms, conditions, coverage, exclusions, products, services and programs which may be available to you. Your eligibility for particular products and services is subject to the final determination of underwriting qualifications and acceptance by the insurance underwriting company providing such products or services. Statements on this website as to policies and coverages provide general information only. This information is not an offer to sell insurance.