How to Avoid Fake Car Insurance

According to statistics collated by insurance aggregators, more than 80 districts in India have hosted fraudulent insurance practices. While most financial frauds are committed in urban areas when the topic of concern is insurance frauds, rural areas lead the numbers in India. 

Reports by India Forensic report for Studies suggest that every year, more than Rs. 30,000 Crore is scammed in the name of insurance policies. One such fraudulent practice was recently brought to the notice of Insurance Regulatory Department of India (IRDAI), which involved a fake company with a domain resembling that of the former. On that account, IRDAI released a notice to warn the general public. Car insurance online and home insurance policies are traded the most in such practices. 

Although the IRDAI duly noted the duplicity, in that case, there are abundant scams that miss the regulatory authority’s notice. To avoid being roped in the same, you need to be aware of it in its entirety. 

How do fake insurance companies work?

Fake insurance companies can be described as unauthorised and unlisted organisations that operate in a scale akin to that of an authorised company or at least pretend to. They display similar level of efficiency and organisational practices to make it look like an original one. 

They provide documents which look like original insurance papers and allow you to believe you are subscribing for a real policy. You pay premiums every year, as stated by the false representatives or as mentioned in such documents. Their smart pretension makes it difficult for an average individual who is not acquainted with car insurance policy or any other insurance policy for that matter. 

Their act is caught when you go to claim compensation in regards to the policy. They will either not respond to your calls or delay the process indefinitely. 

In most cases, deceitful financial institutions contact online or through calls and pose as reputed insurance aggregators to discount chances of doubt in individuals.  

How to avoid fake car insurance online?

To prevent falling prey to fraudulent insurance services, you need to take the following steps – 

  • Make direct contact with insurance aggregator: When you are contacted by any insurance aggregator posing as a reputed institution’s representative, try to verify their credentials or ask for proof which establishes the same. You can also write an email directly to the company to confirm whether the four wheeler insurance policy offered is original or not. 

To avoid any chance of deceit you can directly apply for a Car Insurance policy from Bajaj Finserv. 

  • Verify QR code: The IRDAI has mandated the usage of QR code when offering insurance policy to any individual. When you apply for car insurance online, you should verify the code against a QR reading app to check the authenticity of the policy. 
  • Ask for receipts: Insurance aggregators are bound to provide receipts at every premium payment. When you pay a premium for a third party car insurance policy or otherwise, ensure to ask for premiums from the financial institution. In case you are not given any receipts, it is likely a sham. 
  • Go through policy terms and conditions: In most cases, individuals spare themselves the trouble of reading through the terms and conditions. All the same, a policy may contain dubious points which you can note when you go through the same. If you have reservations regarding any point, contact the insurance aggregator through mail or the number on their official website to clear your doubts. 

In case you are buying a new car, you should avail a car insurance policy as stated by the Motor Vehicle Law. On that account, avoid purchasing it from agents you do not trust and consider applying for car insurance online. 

If you hail from a major city in India, you should also consider a life insurance policy, given the rising numbers of accidents in India. According to statistics, there is one death every 4 minutes in India due to vehicle accidents. 

By Mayank

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