Scammers thrive in moments of vulnerability, waiting for the perfect moment to pounce. Capitalizing on the health fears and financial uncertainties of a nation swept by crisis, COVID-19 is the latest hook used to draw in unsuspecting victims.
Soon after the virus began to spread across the country in March, the FBI reported a rise in COVID-19-related cyberattacks and warned of a significant spike of scams to come, particularly in areas of the U.S. with the highest infection rates, including New York.
Be especially wary of COVID-19 insurance scams. “Robocalls, plus text and email phishing attacks can pitch false insurance deals to consumers of all ages,” according to the Coalition Against Insurance Fraud. “These pitches may ask consumers to pay insurance premiums, without delivering coverage.”
Posing as insurance agents and trusted government health organizations like the Centers for Disease Control and Prevention and the World Health Organization, insurance cons will also try to swipe medical and financial identities.
Here’s what to look out for.
Auto Insurance Scams
Frauds have been putting a COVID-19 spin on their usual bag of tricks out on the roads.
With fewer people driving and in public spaces (read: fewer witnesses), there is more opportunity for schemes like staging accidents – when a car is intentionally rear-ended or sideswiped in order to make false insurance claims – and jump-ins, a scenario in which someone outside of the car at the time of an accident tries to make a false injury claim.
Scammers use social distancing and fear of spreading the virus as excuses to rush along the exchange of information and forgo a police report, making it easier for them to inflate their claim.
Be suspicious of repair shops charging excessive fees for cleaning and disinfecting or storing vehicles. Some shops have been holding onto cars for longer, falsely claiming they can’t work on them due to possible COVID-19 infection.
Always use a shop that you can trust, like one of the thousands of AAA Approved Auto Repair facilities.
Fake Agents and Insurance Companies
There is no such things as COVID-19 insurance; do not speak to any insurance agent that is trying to sell it to you.
Bogus insurance agents can pose as licensed agents from well-known insurance companies and pitch COVID-19 health insurance coverage. They can also call from fictitious insurance companies, fooling consumers into purchasing fake policies. Consumers find out they’ve been scammed when they go to make a claim.
Before signing any checks or contracts, verify that an insurer is licensed to conduct business in your state.
The most vulnerable people to fall for COVID-19 insurance scams are those 60 and older.
Seniors are being targeted by robocalls pitching free vaccines (that don’t exist), home testing kits (not real) and other fraudulent promises.
Scammers are also asking for Medicare numbers and using them to make fake claims against the victim’s account. Residents in senior housing and assisted-living facilities are even being approached in-person for Medicare ruses. Verify all Medicare communications before giving out information. (See below for more tips to help seniors avoid scams.)
Travel Insurance Scams
COVID-19 caused many people to say goodbye to their planned trips – and the money saved for them – even if they had travel insurance in place. Unfortunately, most travel protection plans exclude losses caused directly or indirectly by a pandemic. So, while you may be holding on to hope that you will get some of that cash back in your pocket, any purported travel insurance company that claims coverage for COVID-19 is bogus.
A “cancel anytime” or “cancel for any reason” insurance policy may also be offered to you. While this is a real type of coverage offered by travel insurance companies and should not normally raise a red flag, it comes at an additional expense to an existing policy and never stands alone. It should also be noted that even these policies often include exclusions for pandemics.
When it is time to start traveling again, keep an eye out for third-party booking scams.
Tips to Avoid COVID-19 Insurance Scams
Follow this advice from the FBI and the Coalition Against Insurance Fraud.
- If you are involved in a car accident – no matter how minor – always get a police report. Take pictures and be as thorough as possible with you description of the event.
- Be suspicious of anyone offering something that seems too good to be true. Ignore low-cost insurance or other suspicious deals. Reject sales pitches contacting you without your prior consent or telling you to press “1″ or another key to be removed from a call list.
- Ignore all pitches for COVID-19 insurance or home testing kits. All are bogus.
- Do not pick up the phone if it’s from an unknown number. If you do answer, just hang up; do not engage the caller.
- Never provide your credit card, Social Security number or any personal information to any untrusted source. This includes phone calls, texts, emails or door-to-door salespeople.
- Use extreme caution in online communication. Double-check the email address; criminals will sometimes change just one letter to make it look like one you know. Watch for typos and be cautious of attachments or links; hover your mouse over a link before clicking to see where it’s sending you.
The World Health Organization has warned that criminals are disguising themselves as WHO officials. Organizations like the WHO and the Centers for Disease Control and Prevention will never contact you directly.
Remember, these are professional criminals at work: They are masters at putting on the pressure and can be quite convincing. Stay vigilant and stay safe.
Go to AAA.com/Insurance to speak to a trusted AAA insurance agent.