From time to time, people see flyers posted around cities and sometimes even people trying to sell them insurance of some kind. These people are called insurance brokers. Insurance brokers are very good at convincing people in buying their insurance offer. Though these offers might be very promising, it is still fair to make sure if these offers are legitimate.
Though most of the insurance companies are legitimate, the fraudulent one’s also exist. With the help of their unethical brokers, the scam business and the brokers are able to fish in some clients. Here are a few scams done by insurance brokers to look out for:
- Stealing Premiums – in this case, the brokers take client’s premiums for their own instead of sending It to the insurance companies. The premium usually serves as support for the insurance brokers leisure.
- Selling Deceptive Insurance – insurance brokers will sell fake insurances from fake insurance companies or they will be selling fake insurance coverage from legitimate insurance companies and take the money for themselves.
- Selling Unnecessary Coverage – the insurance brokers sell client’s insurance coverage that are either very expensive or unnecessary for the insurance plan.
Also shown by the statistics from insurancefraud.org, fraud steals $80 billion a year across all lines of insurance and Fraud comprises about 10 percent of property-casualty insurance losses and loss adjustment expenses each year. These statistics show that people should be more observant and careful when it comes to trusting insurance companies and brokers. The terrifying part is that, insurance frauds where suspected in 8% of intentional fires. This only shows that insurance frauds made by fraudulent companies and brokers, not only threaten a person’s savings but also one’s life.
With a very high risk of being scammed by fake insurance companies and brokers, people should start be researching first before negotiating with these insurance companies. Here are a few ways to prevent getting scammed:
- Be Observant – if the offers of the insurance broker seem too good to be true, then it probably is. The scam usually falls in very flowery word and promises.
- Run a Criminal Background Check – the best way to insure legitimacy is by running criminal background checks. Criminal background checks will be able to trace any criminal records of the insurance broker; thus will you make a decision whether to trust the broker or not.
One of the best websites to run criminal background checks is on www.backgroundpi.com. It’s easy and fast. Visit the website to learn more about criminal background checks.