Insurance is meant to provide financial security during difficult times, whether it’s health insurance, car insurance, life insurance, or property insurance. However, fraudsters exploit this necessity by scamming policyholders with fake claims handling services. These scams involve fraudsters posing as legitimate insurance agents, brokers, or third-party claims handlers who offer to process claims, speed up payouts, or recover denied claims—for a fee. In reality, they steal money and personal information from unsuspecting victims.
Scammers often target individuals who are desperate for insurance payouts, particularly after car accidents, medical emergencies, or natural disasters. Victims believe they are dealing with real professionals, only to find out later that they’ve been tricked.
How This Scam Can Happen to Us
1. Fake Insurance Agents or Adjusters Contacting You
Scammers pretend to be insurance agents or adjusters from well-known companies, such as Allstate, State Farm, or Progressive. They reach out via phone calls, emails, or even in person, claiming they can help you process your claim faster.
They may use fake identification, websites, and company logos to appear legitimate.
Some scammers hack into real insurance databases and call policyholders with insider knowledge, making the scam more believable.
2. Charging Upfront Fees for "Claim Processing"
The scammer will tell you that your claim is taking too long or has been wrongfully denied, but they can expedite the process for a fee.
Some fraudsters ask for an "advance payment" to cover supposed "administrative costs" or "legal fees" before they can process your claim.
3. Manipulating Insurance Documents
Fake claim handlers send fraudulent forms or alter your claim details to make it seem like they are working on your case.
In some cases, they submit fake claims in your name, stealing money from real insurance companies, which can result in legal trouble for the victim.
4. Offering Fake Legal Assistance for Denied Claims
If an insurance company denies your claim, scammers may pose as attorneys offering legal help.
They charge high fees upfront and never actually represent you, leaving you in a worse financial situation.
5. Fake Online Insurance Portals
Scammers create fake websites that look like real insurance company portals.
Victims enter their personal and financial details, thinking they are submitting claims, but instead, they give away sensitive information to fraudsters.
Example of a Fake Insurance Claims Handling Scam
A man in Florida was in a car accident and needed to file a claim with his insurance company. A few days later, he received a call from someone claiming to be an insurance adjuster from his provider. The caller explained that the claim was stuck in processing but could be expedited if he paid a $500 fee upfront.
Trusting the agent, the man transferred the money, only to realize later that his actual insurance company never requested such a payment. The scammer disappeared, and the man lost his money with no way to recover it.
How to Protect Yourself from This Scam
Verify the Insurance Agent's Credentials
If someone contacts you about an insurance claim, always verify their identity with your insurance provider.
Call the official customer service number from your insurance policy, not the number given by the caller.
Never Pay Upfront for Claims Processing
Legitimate insurance companies do not charge fees to process claims.
If someone asks for an advance payment, it’s a scam.
Check for Red Flags in Communication
Be suspicious of urgent requests that pressure you into quick action.
Look for spelling errors, unprofessional emails, or vague information in messages.
Use Official Insurance Websites
Always submit claims through your insurance company’s official website.
Avoid clicking on links in emails or texts unless you verify the sender.
Consult a Licensed Attorney If Necessary
If you need legal help with an insurance claim, hire a verified attorney from a reputable law firm.
Avoid anyone who contacts you out of nowhere offering legal services.