Be extremely wary of this new insurance scam that's doing the rounds 4 years ago

Be extremely wary of this new insurance scam that's doing the rounds

Many are being left with no cover whatsoever.

Finding the cheapest car insurance can be a daunting task at the best of times. Shopping around for the best quote can be very time consuming but worth it if you can find a cheaper deal.

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However, when it comes to insurance, if it's too good to be true, it probably is.

According to the Irish Independent, there is currently a motor insurance scam doing the rounds in Ireland which is charging people up to €300 for fake policies which, in turn, leaves the driver with no cover at all.

Policies targeting younger drivers and foreign nationals who are desperate to find cheap car insurance and would not be that familiar with the whole process are reportedly being sold online or in pop-up shops.

Hundreds of fake policies have been issued so far and the fraudsters pose as middlemen who claim they can cut the cost of your insurance by a massive amount.

They are known as ghost brokers and their discounted, fake policies are invalid, meaning that their customers are driving around thinking they are insured but would be unable to make a claim if they were in an accident.

Speaking on Northern Sound's Joe Finnegan Show, Personal Finance Editor with the Irish Independent, Charlie Weston, outlined how the ghost brokers operate.

"They are basically people pretending to be insurance brokers who are taking advantage of the fact that prices in motor insurance have gone up by an enormous amount in the last three years, something like 60%," said Weston.

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Weston added: "They are a new type of fraudster who is preying on young people in particular and foreign nationals. They offer them a discounted price for motor insurance policies but as it turns out, they are not really insurance policies at all."

He concluded: "They are using fictitious names and details and they are selling counterfeit insurance discs and insurance documents."