Protect Yourself from Insurance Seller Scams
- lauryn04
- May 20
- 2 min read
Updated: 2 days ago
With insurance fraud continuing to rise across Canada, being informed is crucial. Fraudsters are constantly adapting their tactics, especially online. Knowing how to spot a scam can protect you from financial loss, denied claims, or even legal trouble.
Understanding Insurance Seller Scams
One of the most common and damaging types of fraud is the insurance seller scam, often run by individuals referred to as ghost brokers. These unauthorized sellers issue fake insurance policies to unsuspecting buyers. Victims often only discover the scam when it's too late—after an accident, during a police stop, or when attempting to file a claim.
What is an Insurance Seller Scam?
An insurance seller scam involves an unauthorized person acting as an insurance broker or agent. They sell fake insurance policies without the buyer’s knowledge. Consequently, the buyer believes they have valid coverage but, in reality, they do not.
What Happens If You Buy a Fake Policy?
Being scammed by a ghost broker can have serious repercussions:
No Coverage in an Emergency: If you try to make a claim, the insurance company won’t have any record of your policy—because it doesn’t exist.
Criminal Charges: You could be charged for driving without valid insurance. This may lead to vehicle impoundment, a license suspension, fines, and even a criminal record.
Higher Premiums in the Future: A lapse in coverage caused by unknowingly driving without insurance could result in increased costs when you finally secure a legitimate policy.
Financial Loss: You will lose any premiums you paid to the fraudster, and you won’t get them back.
Red Flags: How to Spot a Scam
Keep an eye out for these common signs that an "insurance broker" may not be legitimate:
The premium seems suspiciously low compared to other quotes.
The insurance company name on your documents doesn’t match the insurer's official website.
The person asks you to pay in cash, via e-transfer to a personal account, or through cryptocurrency.
They charge a fee just to give you a quote.
There's no digital trail: no website, no legitimate company email address, or only vague contact details like a P.O. box.
How to Buy Insurance Safely
To ensure you’re buying a genuine policy from a licensed seller, follow these best practices:
Ask for referrals from trusted sources like family and friends.
Verify credentials through your provincial insurance regulator or broker association.
Use the Insurance Brokers Association of Canada (IBAC) broker directory: https://www.ibac.ca.
Check the insurance company’s official website to confirm the broker is authorized to sell on their behalf.
Read reviews and verify contact details before proceeding with any quote.
Shopping for Insurance Right Now?
WAVE'S brokers can shop around for you and find the best coverage for your situation. This usually means getting you quotes from multiple insurance companies so you can take your pick.
Why Trust WAVE?
At WAVE, we prioritize securing the best deals for our clients. Understanding the nuances of insurance can be overwhelming. That's why our trained brokers guide you through each step. They help you navigate the sea of options available in the market. You deserve a policy that adequately protects your assets without breaking the bank.
Have more questions? Contact us today! Toll Free: 1-855-809-5166 Email: hello@waveins.ca
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