Insurance, particularly, auto insurance, is a large and growing market in modern times. As with most large markets in our society, they are frequent to people taking advantage of them to make their own fortunes. The opportunities for people to create and run auto insurance scams are great and reports of this type of fraud are growing every year. So what can you do to avoid people one of the unfortunate souls that are scammed every year by these fraudulent companies? Here is some information to help you to safely purchase auto insurance and avoid the frauds.
The first rule is always to beware of the really low priced deals out there. If a deal just sounds too good to be true, it probably is. For example, if you have a bad credit history and bad driving history, yet a company offers you auto insurance at a fraction of the cost that anyone else would, it’s probably not a safe deal.
Auto insurance companies want to make money, so the higher risk you are to them, the higher your rate will be. Following this logic, any company that offers a high risk client a rock bottom price is suspicious.
Try not to purchase auto insurance from a company no one has heard of. Don’t purchase from a company with little to no background that you can research. If it’s a new company, ask around for current or former customers and see what they have to say.
The best bet, however, to purchasing non-fraudulent auto insurance is to go with a reputable company, a big corporate name that has many customers and a lot of background that you can research. The more you can research a company, the more you can find out if they have any bad reviews or black marks on their customer service record.
One option available to you is to get free quotes. Most reputable companies will offer you free quotes. If a company tells you that you have to pay a fee first before they will give you a quote, let this be a red flag to you. You should only pay for the actual auto insurance premium, and not the quote. If they ask for money before you get a quote, take your business elsewhere.
Another warning sign is promotional deals; say 50% off for 6 months or free months. These deals are there to pull you in and once the offer expires, you could end up paying a very high amount for your premiums or you could even find out your premium is worthless because they aren’t a licensed auto insurance provider. The last thing you want to happen is to find out, after an accident, that you have to foot the several tens of thousands of dollars bill because your auto insurance provider is actually a scam artist.
Another great thing to do to avoid being scammed by a fraudulent auto insurance company is too go to your local government office that controls the licensing of auto insurance companies and check to see if the company you are consider is actually holding a license in that state. If they are not, then they are a scam company and any premium with them is worthless.
Do your research and look into the background and customer reviews of every company you consider until you find one that fits your needs and that you know is reputable.