Young motorists are being warned about the dangers of 'ghost broking' scams, as new research reveals that nearly half of drivers aged 17 to 25 have purchased insurance through social media or messaging apps.
Survey Highlights Widespread Vulnerability
A survey conducted by Kantar on behalf of the Financial Conduct Authority (FCA) found that around 49% of young drivers have bought insurance via these platforms. Approximately 39% admitted they would not feel confident in identifying signs of a fake policy.
Ghost brokers are criminals, not legitimate brokers, who sell bogus insurance policies online. They often target young people and students with limited experience in buying insurance.
Risks of Falling Victim
These fraudulent policies are either entirely fake or contain falsified details to artificially lower the price. Victims may unknowingly drive uninsured, facing prosecution, fines, and vehicle seizure.
More than two-fifths (45%) of young respondents said they generally trust products bought through social media, while 15% struggle to fit insurance into their monthly budgets.
FCA Advice to Stay Safe
The FCA urges drivers to be wary of deals that seem too good to be true and to avoid offers only available via social media. Genuine sellers must have a legitimate website, phone number, and address. Consumers should verify a firm's details using the FCA Firm Checker tool on its website.
Graeme Reynolds, director of insurance at the FCA, said: 'Tight budgets make cheap offers tempting – and scammers take advantage of that. Don't get ghosted by a policy that doesn't exist. Check the FCA Firm Checker before you buy, because driving uninsured could cost you far more than any premium.'
Chris Bose, director of general insurance at the Association of British Insurers, added: 'Ghost broking leaves victims uninsured, out of pocket and potentially facing serious legal and financial consequences. Motorists can stay vigilant by avoiding offers solely advertised on social media, contacting insurers directly, and using the FCA Firm Checker. The golden rule is to never act in haste – if a deal seems too good to be true, then it probably is.'
