New drivers warned of ‘ghost brokers’ as fake car insurance scams increase 50% in last 2 years

16 May 2025, 12:36

New drivers are being warned of a sharp rise in fake car insurance deals which leave them uninsured, and could lead to fines or driving bans.

New figures show the issue has grown over 50% in two years, as fraudsters pretending to be brokers are increasingly targeting young drivers who face higher premiums.

The practice involves scammers, known as ‘Ghost Brokers’, advertising bogus deals on popular sites such as Facebook, Instagram, SnapChat and TikTok.

The scams are targeted at new drivers, including those insuring their first car and learners who need learner cover.

The IFB has launched a campaign with the Association of British Insurers (ABI) and City of London Police to raise awareness of the issue.

To help protect the public, an awareness initiative supported by the government’s Stop! Think Fraud national campaign, has been launched in partnership with the ABI, the Insurance Fraud Bureau (IFB) and City of London Police.

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Ursula Jallow, Director at the IFB, said: “New drivers are caught out by Ghost Brokers because they face higher premiums and have had less experience in purchasing insurance policies for themselves, which unfortunately means they are more likely to be attracted to car insurance deals, that are too good to be true.

“The impact is devastating. We’ve seen victims lose thousands of pounds, have their identities stolen, their confidence and self-esteem shattered, and in some cases, they have even had their car seized for driving uninsured."

The fraudsters exploit the high costs young drivers face, along with their lack of experience when it comes to buying insurance, with appealing promotions.

This involves marketing themselves towards young social media users, promising to offer the lowest rate on the market - even if the driver has convictions - and offering up-front quotes, despite the fact insurance is meant to be priced based on the risk of the individual.

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Insights also show that learner drivers who may need to insure a car that they are practicing in are also falling victim to the scam.

The policies are taken out using stolen details which belong to people who are cheaper to insure, which are then sold on at a reduced rate, or they may simply be a photoshopped piece of paper; in both instances, the policy is invalid and the victim is driving uninsured.

The scale and impact of the issue is vast with thousands of young people believed to be getting targeted by Ghost Brokers each day. A YouGov survey (commissioned by IFB) found one in five (18%) 18-24 year olds have used social media to search for car insurance.[2]

Falling for a Ghost Broker’s deal has devastating consequences. Victims can lose hundreds and in some cases, thousands of pounds.

Meanwhile, they will be driving without valid insurance, which means they can have their car seized by police, receive 6 licence points, a £300 fine, and a court referral where they may get an unlimited fine and/or a driving ban.

Figures released today confirm around 115,000 fraudulent motor insurance policies were detected by the IFB in partnership with the insurance industry between 2023-24, with Ghost Brokers believed to be responsible for thousands of cases.

It’s estimated fraudulent insurance applications cost the UK economy over £1 billion a year.