Written evidence submitted by Direct Line Group (OSB0082)

John Ashmore

Head of Counter Fraud

Direct Line Group

Churchill Court

Westmoreland Road

Bromley

Kent

BR1 1DP

15th September 2021

Dear Sir/Madam,

Direct Line Group (DLG) welcomes the opportunity to respond to the call for evidence for the draft Online Safety Bill: call for evidence, published by HM Treasury.

DLG provides a wide range of general insurance products to consumers through a number of well-known brands including Direct Line, Churchill, Privilege and Darwin. It also provides insurance services for third party brands through its DLG Partnerships division. In the commercial sector, its NIG, Direct Line for Business and Churchill Business Insurance operations provide insurance products for businesses.

In summary, DLG welcomes the review and the proposed bill.

The issues

DLG is becoming increasingly concerned about the prevalence of fake adverts on social media and the use of ad words on search engines. This use of ad words means the search engine results can sign post customers to impersonation adverts.

DLG currently views these as one of the fastest growing aspects of online fraud. Both of these issues have a significant knock-on effect for customers, claimants and the insurance industry, but the draft Online Safety Bill makes insufficient provision to tackle the problem.

Impersonation Adverts

The impersonation of search engine ads is fast-becoming one of the most common aspects of online fraud.

When an accident takes place, the first thing that many of those involved do is an online search to find their insurer’s contact details.

Scammers have taken to impersonating the pay per click results that are commonly seen on search engines, providing telephone numbers and impersonating a “claims department” should anyone call them[1].

Scammers utilise pay per click advertising, to make sure that their fake ads appear above those of genuine businesses.

The supposed “claims department” then signs callers up to a financial agreement and puts them into a credit hire vehicle (a vastly more expensive version of a courtesy car) without the claimant’s knowledge. Often, services such as vehicle recovery and storage are added, all at an inflated cost.             

The claimant may never discover they’ve been scammed, and the additional costs could have a major impact on their insurance premiums once the bill from the scammer makes its way to their insurance company.

Tackling the issue is difficult, complicated, and long-winded. DLG currently negotiates with search engines to either remove offending ads or ensure that DLG is top of any search engine results. Where DLG is successful in removing the websites, others spring up to take its place.

Ghost Brokers 

Adverts offering insurance for sale are offered illegally to a wide range of individuals through social media platforms.

This is referred to as “Ghost Brokers” which are illegal insurance brokers[2].

Ghost brokers usually target individuals who might struggle to get insurance via legitimate methods (for example, due to points on their licence or criminal convictions).  This means innocent consumers who know no better are being scammed and driving without insurance.

Fake Insurance Certificates and No Claims Bonus are also offered for sale.

The Solution

Provision should therefore be made within the Online Safety Bill to protect consumers, mandating search engines and social media organisations to apply greater due diligence to the credentials of advertisers on its platforms.

It is acknowledged that Internet education within schools is helpful. Wider promotion/education of internet safety must happen to help consumers to both recognise fake ads and understand the dynamics of search engine optimisation.

Online Safety Bill

The Online Safety Bill presents a key opportunity for the Government to take action to tackle the issue of online scams, and mandate search engine companies to vet their advertising customers more thoroughly.

Enacting these changes will:

• Protect consumers from fraudulent ads that will ultimately reap havoc with their insurance premiums; and
• Prevent costly and time-consuming court litigation of those cases that make it to court, particularly relevant at a time when court capacity is hugely under strain.

If you would like to discuss any of these points further, please do not hesitate to contact me.

Yours sincerely,

John Ashmore

Head of Counter Fraud

21 September 2021