Life insurance scams & how to avoid them

In today's digital age, scams are more prevalent than ever. Every day you probably receive some sort of unsolicited message or call, even if it goes straight to your spam folder. Just like any financial product, life insurance can also be a target for scammers looking to exploit people's trust.

In this guide we'll look at some common types of life insurance scams and what you can do to avoid them.

Common life insurance scams

Criminals typically target people in three forms. Some scams can be amateurish and easy to identify, while others may be more sophisticated and harder to dispute.

Email scams

Email scams are one of the most prevalent methods used by fraudsters. Such emails may urge you to confirm personal information or provide sensitive data to prevent your policy from being cancelled.

Always double-check the sender's email address and avoid clicking on links or downloading attachments from unknown sources.

Signs of email scams:

• Urgent language: Scammers often create a sense of urgency, claiming that immediate action is needed to avoid cancellation.
   

• Suspicious links: Hover over links to see their actual destination. If the URL looks strange or doesn’t match the company’s official website, don’t click on it.
   

• Requests for sensitive information: Be cautious if the email asks for personal details, such as bank account information or passwords. Reputable companies will not request sensitive information via email.
   

• Poor grammar and spelling: Many scam emails contain typos and bad grammar. If the message appears poorly written, it’s likely fraudulent.

Phone Scams

Scammers may call you impersonating a well-known insurance company. They may claim there’s a problem with your policy or suggest that you need to make immediate payments to avoid lapsing cover.

The number that calls you is often spoofed, making it look like it's coming from a legitimate source. The voice may even be automated telling you to press a number to connect with a representative or make an urgent payment.

Signs of phone scams:

• Unsolicited calls: Be wary of unexpected calls from people claiming to be from your insurance company, especially if they request personal information or prompt for a payment.
   

• Pressure tactics: Scammers usually use high-pressure tactics, insisting you act immediately or face negative consequences. This might include threats of policy cancellation or losing out on benefits.
   

• Requests for payment: If someone asks you to provide credit card information or make a payment over the phone, take caution. Legitimate companies will typically guide you through official channels for payment.

Text (SMS) scams

Another way scammers are targeting people is through text messages or 'SMS' (short message service). These messages often mimic insurance providers, offering enticing deals or alerts regarding supposed policy issues.

Signs of text scams:

• Unsolicited offers: Be cautious of texts that promise hefty insurance discounts or urge you to click a link to verify your policy details. Often, these messages aim to harvest your sensitive information or install malicious software.
   

• Short links: Scammers commonly use shortened URLs to mask the real destination. If you receive a text with a short link, do not click it unless you are certain of the sender.
   

• Random numbers: If the text comes from an unfamiliar or random number instead of a verified source, it’s a strong indicator of a scam. Legitimate businesses typically use dedicated numbers to contact customers.

How to avoid life insurance scams

While spotting scams is crucial, other measures will further protect you. Here are some essential tips on how to avoid falling victim to life insurance scams:

1. Verify the source

Always double-check the contact information you receive. If you receive a call or text from someone claiming to be from your life insurance provider, hang up or ignore the message. Use the official phone number or website of your life insurance company to verify the information.

2. Never share personal information

Be cautious about disclosing personal information such as your National Insurance number, bank details, or policy numbers to unknown contacts. Reputable companies will never ask for sensitive information via text or calls.

3. Monitor your policy regularly

Keep up to date with your life insurance policies by reviewing them regularly. This knowledge will help you recognise any discrepancies or unusual changes that could indicate fraudulent activity. Awareness of your policy details makes you less susceptible to scam tactics.

4. Block numbers

If you receive repeated calls or texts from suspicious numbers, do not hesitate to block them directly on your device. Most smartphones offer the ability to block calls and messages with just a few taps. By blocking known scam numbers, you can significantly reduce the likelihood of further attempts to contact you.

5. Report scams

If you receive a suspicious call, you can contact Stop Scams UK, an emergency hotline that connects you directly to your bank when you dial 159. This service includes 28 members from the banking, technology, and telecoms sectors.

You can also report any phishing fraud to the government via report@phishing.gov.uk, even if they don't lead to actual fraud. For further guidance on recognising and avoiding scams, visit GOV.UK.

What to do if you think you've been scammed

If you think you've been scammed, it's important to act quickly to minimise potential damage. Follow these steps to protect yourself and your finances:

Contact your insurer

Immediately reach out to your life insurance provider to inform them of the situation. They can check for any unauthorised changes to your policy or potential fraud on your account. They may also flag your account for additional monitoring.

Update Your Passwords

Changing your passwords will prevent criminals from accessing your accounts. Create strong passwords with a combination of upper and lower-case letters, numbers, and special characters.

Don’t use the same password across multiple platforms. If one account is compromised, others could quickly follow suit.

Contact the Authorities

If you think you’ve lost money or have been hacked due to an online scam or fraud, you can contact Action Fraud by following these steps:

1. You can visit theAction Fraud website and choose to either sign up for an account or continue as a 'guest' to report the incident.
2. Alternatively, you can directly call Action Fraud at 0300 123 2040 to report your situation.

Make sure to have any relevant information and records handy when you report, as this can help in your case.

If you receive an email, text message or phone call from someone pretending to be Cavendish Online, or if something doesn't look right please call us on 03456 442 540 (Monday - Thursday 9am – 5.30pm, Friday 9am - 5pm).

We advise you to report any suspicious communications to ensure that proper action is taken. This also helps to protect others from becoming victims of the same scam. If you’re with another insurer, please contact your insurer directly.