Auto insurance rates are up, and insureds shopping around for more affordable coverage are prime pickings for fraudsters. According to the Texas Department of Insurance (TDI), the number of fraud reports regarding phony auto insurance cards has spiked, and they're urging consumers to use caution.
In 2023, there were 38 reports of fake insurance card fraud to the TDI, but in 2025, that number rose to 126. The scammers don't appear to be slowing this year, either. NBCDFW reports that the TDI recorded 37 reports of insurance card fraud in just the first three months of 2026.
In these scams, customers purchase auto insurance coverage and are provided with ID cards, just like a legitimate policy. However, when insureds need to use their coverage or are pulled over for a traffic violation, they find out they have purchased a fraudulent policy, with the scammers keeping their money.
TDI also offers the following tips to help avoid this type of insurance fraud:
- Beware of companies that offer extensive coverage at a low price.
- Get agent and company information from the state insurance authority before purchasing coverage. Customers should also check a carrier's licensing status, company complaint indexes and financial ratings before purchasing a policy.
- Customers should take as much time as they need when buying insurance, and not let an agent or company representative pressure them into making a decision.
- Always pay by check or credit card so payments can be traced and verified, and never through a third-party payment app. If a customer must pay in cash, they should get a receipt that shows the name of the company, date and the amount paid.
- Be cautious of insurance policies that are sold door-to-door or over the phone.
- Keep and protect all insurance documents. Customers should also keep notes of any telephone or in-person contacts related to their coverage, including the name and title of the person they spoke with, the date and what was discussed.
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