Beware of a new type of motor insurance scam

Here is a new type of motor insurance scams that target motorists - and not the insurance companies.

Mr X's car was hit by a van. He reported to an reporting centre. An agent of the workshop approached him and told him that the workshop can handle his third party claim - so that he does not need to lose his No Claim Bonus. Mr. X agreed and sign a few forms given by the workshop.

Six months later, the workshop told him that they could not proceed with the third party claim as the other party had a witness that Mr. X had turned into is lane. The workshop asked Mr. X to pay for the repairs at about twice of the estimated cost. If Mr. X did not pay, the workshop would get a lawyer to sue him. It seemed that the forms signed by Mr. X gave this legal right to the workshop.

Mr. X approached his insurance company to handle the claim, but the insurance company refused - as Mr. X did not meet the policy condition of getting his own insurance company to handle the repair in the first place.

Mr. X is now in a dilemma - having to pay for a claim that should be covered by the insurance policy and now having to pay for twice of the actual cost. Mr. X suspected that the workshop was acting fraudulently and was targeting him in the first place.

Lesson - always leave it to your insurance company to handle the repairs. Do not try to save on your No Claim Discount. It is not worth the unexpected trouble.