Keeping you and your family safe and secured even after death is one of the main reasons for getting a life insurance plan. Although there have been more convenient ways to get quotes and find agents that can help you, always be cautious of life insurance fraud. To avoid being a victim, you should know about common scams and how you can prevent them.
Types of Life Insurance Fraud
In getting insurance plans, there are many ways you might get scammed. This can be through a misleading ad that offers cheap coverage or through an agent trying to deceive you. Here are some common life insurance scams:
- Insurance Churning – This is the practice of selling or upselling an insurance policy for the sole purpose of earning an additional commission. Insurance churning not only puts you at risk for a policy that’s not entirely beneficial for your situation, but it may also require you to pay higher premiums.
- Identity Theft – Life insurance is one of the many ways you can become a victim of identity theft. Here, scammers will have access to your personal information and use them to open bank accounts or make purchases under your name.
This can happen when someone reaches out to inform you of issues with your insurance policy such as late payments. They may ask for vital information to “fix” it including credit card details or your social security number.
- Insurer Fraud – This occurs when an insurance agent deceives clients for their own benefit involving money. An example is when they offer higher premiums than the actual cost so they can keep the difference. Although some prefer to target the elderly, anyone can be a victim of insurance agent fraud.
How To Prevent Insurance Scams
While schemes like these can be out of your control, it’s still better to be prepared. Here are some ways you can prevent insurance fraud:
- Ask for referrals – Seek advice from a friend or a member of your family. Finding a trustworthy agent can be easier through their firsthand experience.
- Research on the company – There are several insurance companies on the market today. To make sure that you are dealing with a reputable agency, try to do some research and find reviews about their services.
- Revisit your policy – Forgetting the specifics of your policy can be unavoidable. If your agent offers any changes, you may revisit your documentation to ensure that nothing unusual happens.
- Be careful with your information – Do not give out information if you receive calls or emails about your policy from people other than your agent. If this happens, contact your insurance company right away.
Get in Touch With Midwest Employee Benefits
Keep your mind at ease from life insurance fraud by reaching out to a reputable insurance specialist. Call us at Midwest Employee Benefits in Sioux Falls to learn more about our life insurance plans.
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