So, how do you avoid being scammed into a life insurance policy? Here is what you need to know.

Fake companies

The insurance industry is brimming with “new kids on the block” that promise to change the game and make life insurance less mechanic and more human. As much as this is true for some new companies, you are bound to find a few fake ones in the mix. When dealing with a sales agent over the phone things can get trickier. However, to know if the company is real it is vital to check that they are a registered Financial Service Provider (FSP). If not, it is best to hit the road running before they hit the road running with your hard-earned cash.

You are not led through an underwriting process

Another red flag to keep an eye out for is a rushed process. All legitimate insurance and financial companies will take you through an underwriting process, which is an analysis by an underwriter, to check the level of risk you pose. It is also to assess how much coverage you will need to adequately cover you. Furthermore, customers are protected by a consumer’s act called Treating Customers Fairly (TCF) that holds financial companies accountable for selling you a product that is suitable for you. However, being rushed through a process that you do not understand just to talk about payment arrangements is a sign that you are being scammed.

Discrepancies with their online footprint

Insurers have adapted insurance to make it easier. It is only a click away. You can now get an obligation free quote to know where you stand before speaking to a call centre agent or a financial advisor.  However, this has also opened doors for insurance scammers to seep through. Things to check when applying for insurance online are:

• A secure ‘https’ address which can be found on the top left corner of the site's address. It should show a padlock that is either green or grey to show that it is a secure site.
• Details are the same on every page. Check that the name of the site is spelled correctly. Most companies use their company name in their email address or contact information. If anything looks suspicious, it probably is.
• The social media footprint is something that most insurers have on one of the many platforms. If you cannot find a trace of an insurance company on Facebook, Twitter, Instagram, Linkedin or Youtube then you could be dealing with scammers. It’s good to keep in mind that scammers have also become savvy by setting up fake profiles. A legitimate company has a consistent social media footprint.

Where there’s no trail there is a dead-end

What this means is that if you are not able to find a digital footprint of the company in terms of reviews, news, or reports, you could be dealing with a fake company. The take-home is to be careful before handing over sensitive information such as your banking details and I. D number which could end up in the wrong hands.