Glossary

Ghost broking

A scam in which someone poses as an insurance agent and sells fake, altered or fraudulently obtained policies, often at too-good-to-be-true prices.

Also called: ghost broker, fake insurance broker, ghost brokering

Ghost broking is a form of insurance fraud in which a fake middleman sells car insurance that is not what it seems. The term comes from the United Kingdom, but the same schemes target U.S. drivers through social media, messaging apps, word of mouth and online ads, often aimed at drivers who struggle to find affordable coverage.

Ghost brokers use a few methods. Some sell entirely fake policies and documents. Others buy a real policy with false details, such as a cheaper garaging address, a different driver or a clean record, then resell it at a markup; the insurer cancels it when it discovers the truth. Some take out a policy, print the Insurance ID card and cancel right away, pocketing the refund. In each case the buyer may be driving uninsured without knowing it and can be held personally responsible after a crash.

Warning signs include prices far below other quotes, payment by cash, gift card, wire or payment app, a seller who does not appear in the state's license database, and no documents from the insurer itself. Buy from an admitted insurer directly or through a licensed agent, confirm the policy with the insurer, and report suspected sellers to your state insurance department or fraud bureau. See ghost broking and fake car insurance policies.

Last reviewed October 4, 2026

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Related terms

Insurance fraud Deceiving an insurer, or a policyholder, for financial gain, from staged crashes and padded claims to fake policies and lies on applications. Admitted insurer An insurance company licensed by a state's insurance department, which regulates its rates and forms and backs its claims through the state guaranty fund. Insurance ID card The card your insurer issues showing the company, policy number, insured vehicles and coverage dates, carried as proof of insurance. Garaging address The address where a car is mainly parked overnight, which insurers use to price a policy and which must be reported accurately. State department of insurance The state agency that licenses insurers and agents, reviews rates and policy forms, monitors solvency and handles consumer complaints.

Related guides

Fake insurance cards and how they are caught Where counterfeit and worthless insurance cards come from, how state databases and claims expose them, the penalties, and what to do if you are hit. Ghost broking and fake car insurance policies How ghost brokers sell fake or doomed car insurance through social media and word of mouth, who they target and how to confirm a policy is real. Auto insurance fraud explained What counts as auto insurance fraud, the difference between hard and soft fraud, who commits it, what it costs drivers and how it is investigated and reported. How to protect yourself from insurance scams A practical checklist for avoiding car insurance scams when you buy a policy, pay for it, get calls about it, have a crash, or buy a used car. State insurance fraud bureaus: who investigates and how to reach them Most states run an insurance fraud bureau that investigates and refers cases for prosecution. How they work, examples from six states, and how to reach yours.