Each year, Americans lose millions of dollars due to insurance scams. Worse, the victims find themselves without health, auto, home or life insurance coverage when they need it most. The most common form of fraud is selling policies, and collecting premiums, for fake insurance. Take these steps to reduce your risk of being scammed.
- Make sure your insurance company is licensed to do business in your state. You can check with the state department of insurance.
- Think carefully if you feel pressured to make a decision on coverage quickly, or if you feel your questions have been ignored.
- Resist suggestions to cash in your existing insurance policy, annuity or investment fund in order to purchase a new policy.
- Be wary of plans that claim to offer "free" government health plan if you pay an upfront fee. Scams like this have multiplied since the affordable care act was passed.
- Be very suspicious of claims that a plan has a waiver from federal or state regulations.
- Work with a reputable, licensed independent insurance agency that can help you avoid plans and get the coverage you need.