There are many types of car insurance rip-offs - some involving car insurance companies and others involving individuals trying to defraud the system. Here are 5 practices that you need to be aware of:

1. Low quote followed by higher reality.
You know that you need to shop around if you want to get an affordable auto insurance quote so you investigate and find the best deals you can. From the long list of potentials, there is one that is substantially cheaper. You think you've hit on a bargain so you sign up. Just as you're getting used to paying less for on your auto insurance, you get mail telling you that there has been an error and your real premium should be several hundred dollars higher than what you are paying.

2. Buying from a Fake Agent.
Just because an auto insurance broker has a physical location doesn't automatically mean that they are a legitimate agent representing an actual insurance company. A proof-of-insurance card can be forged just as easily as other business materials. One indication that all may not be as it seems is if the agent issues their own auto insurance. They can't legitimately do that because they are 'agents' which means that they represent an insurance company and aren't an car insurance company in their own right.

3. Going through a middleman who represents a Mock Company.
While the agent may seem legitimate, you need to do your homework on the company they claim to represent.

4. Price Fixing Between Auto Insurance Company and Repairer
Car insurance companies want to pay as little as possible for repairs to your car but they also want to keep you paying high premiums so they forge a deal with a repair company to minimize their ongoing costs. For example, a car insurance company may recommend a repairer that inflates the worth of the car and then charges a high amount to repair the car. In this instance, the car should probably be written off as totalled but the repairer doesn't do this because it will lose business and the insurance company will lose on deductibles.

5. Car insurance quote in exchange for personal details.
If you receive a phone call from an insurance agent offering a free quote on car insurance in return for you providing personal information, don't be tricked into giving any details. Providing information in this instance leaves you vulnerable to having your identity stolen. The only information required for a auto insurance quote should be information about the car. Of course, eventually they will need more information than that to proceed with organizing car insurance cover but by then you should be feeling comfortable enough to be prepared to provide those details.

While none of the above may happen to you, it is important to be aware of what can happen so that you are not lulled into a costly and frustrating mistake.