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Consumers in dark on latest insurance scams

About half of adults in Britain struggle to tell the difference between a real and fake insurance advert, a survey commissioned by the Association of British Insurers has found.

Four out of five who say they are aware of insurance fraud have never heard of “ad spoofing”, a tactic fraudsters use to trick road accident victims into using a fake website that makes them think they are dealing with their insurer.

Almost one-third of the 2000 survey respondents say they have never heard of online insurance fraud.

The finding has prompted the association to launch a campaign to raise awareness of scams.

The association says even among those who have heard of online insurance fraud, knowledge of specific types is low. For example, 78% have not heard of data farming – the use of direct marketing or cold calling to encourage people to make false or exaggerated claims. And 81% are not aware of “account takeovers”, when a scammer takes over a policy or claim to either misdirect a premium refund or claim payment.

“At a time when household budgets are already being squeezed by the cost of living, no one wants to get caught out by the scammers,” the association’s head of fraud and financial crime Mark Allen said.

“From deals that look too good to be true, to opportunistic claims companies preying on people when they’re at their most vulnerable, we’re calling on everyone to be alert and don’t fall foul of the fraudsters.”

UK Insurance Fraud Bureau director Ursula Jallow says online insurance scams are widespread and becoming increasingly sophisticated. “So it’s really important to stay cyber savvy and know the difference between a real deal and one that shows signs of something not being quite right.”

Ms Jallow says the Association of British Insurers’ campaign is shining a light on some of the most devastating scams.

“We encourage everyone to follow [the] tips to avoid being targeted.”