6 car insurance scams you need to avoid

From misleading repairer clauses to unclear policy terms, scammers and some dodgy insurers know how to take advantage of unclear fine print. But with the right knowledge, you can protect yourself and your vehicle from falling victim.

At Sheen Panel Service, we’ve handled thousands of insurance claims and understand how to avoid traps. We’ll handle your repairs, work with your insurer, and help you avoid the most common car insurance scams.

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1. "Preferred repairer"

Some insurers include a “preferred repairer” clause in their policies, limiting where you can take your car for repairs after a car accident. While this clause may sound convenient, it often exists to reduce costs for the insurer, not to ensure the best outcome for your vehicle.

• Non-genuine parts may be used by preferred repairers, compromising the safety and longevity of your vehicle.
• Replacement vehicles are often not included, leaving you without a car during repairs.

Instead, look for an insurance policy that includes a choice of repairer. Choosing your repairer means you can prioritise quality, safety, and service.

At Sheen Panel Service, we guarantee your vehicle is repaired to the highest standards:

• We use genuine parts and manufacturer-approved methods for every repair.
• We provide accident replacement vehicles to help you stay mobile while your car is being restored.

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2. Dark patterns in car insurance

Some insurance providers use dark patterns—misleading or manipulative tactics in their online processes—to make policies seem more appealing or harder to opt out of. These tactics can trick customers into paying more than expected or lock them into less-than-ideal coverage.

Common examples include:

• Roach motel: A setup that makes it easy to sign up but incredibly difficult to cancel or change.
• Hidden costs: Extra charges like processing fees that appear late in the quote or checkout process.
• Misdirection: Drawing your attention to flashy features while burying important details like exclusions or excesses.

If you're purchasing car insurance online, don’t rush. Each click should be treated as a fresh decision, from getting a quote to confirming your payment. Read the fine print, check for car insurance scams, and ensure everything is clear before committing. If anything feels off, pause and reassess.

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3. Long waiting times for claims

Time is money, and long delays in processing car insurance claims can cost you both. Some insurers have been known to drag out the process to protect their bottom line, leaving you stuck without a vehicle for weeks.

Extended delays can result in:

• Loss of income, if you or your family can’t get to work due to a lack of transport.
• Loss of mobility, if your car is in the repair shop or written off, and there’s no replacement vehicle.

If your insurance company takes over two weeks to respond, follow up regularly and escalate if needed. Don’t let your insurer leave you in the dark, especially if you’re waiting to make a car insurance claim after an accident.

At Sheen, we cut through the waiting game. Not only do we help manage repairs, but we can also assist with insurance communication and provide a free accident replacement vehicle to keep you moving while your claim is processed.

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4. Roadside assistance upsells

This one's more of a money pit than a scam. Many big and small insurance providers push policyholders to pay extra for roadside assistance as an optional add-on. While it might sound like a convenient inclusion, the service often underdelivers when you need it most.

Common issues with roadside assistance include:

• Limited services, which may exclude serious mechanical failures or accidents
• Patchy coverage and slow response times, meaning you could be stuck on the side of the road for hours

Before paying extra, weigh the pros and cons. If your insurer outsources roadside assistance to a third-party provider with limited reach, it may not be much help, especially if you're driving long distances or in rural areas.

In an emergency, your best move is to call a reliable tow truck service and get your vehicle to Sheen Panel Service. We’ll organise smash repairs and help with your insurance claim so you're back on the road sooner.

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5. Limited-time insurance offers

Like dark patterns, limited-time offers often mislead customers in car insurance advertising. Insurance companies may promote a discounted rate for a short period, giving the impression that you’ll retain those savings long-term, when the price could jump later.

Common pitfalls include:

• Fine print that buries disclaimers like “offer ends 30 June” or applies terms you won’t notice until renewal.
• Price hikes that transform a low introductory rate into a monthly expense you didn’t plan for.

To avoid getting caught out, always read the product disclosure statement (PDS) carefully. If something looks too good to be true, it probably is. When comparing car insurance rates, don’t focus just on the headline figure—check for exclusions, conditions, and how long the rate lasts.

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6. Unclear terms in your car insurance policy

One of Australia's most common car insurance scams involves vague or confusing terminology. By using unclear phrases, complex legal jargon, or ambiguous definitions, some insurers make it harder for drivers to understand their rights, leaving room for the insurer’s interpretation later on.

Common issues include:

• Watch out for deliberately misleading terms like “variable liability limit” or “all-risk coverage”, which sound comprehensive but can mean something very narrow.
• Written definitions in your product disclosure statement (PDS) are essential—don’t rely on verbal explanations or marketing brochures.

You are never obligated to sign anything you don’t fully understand. Under Australian law, it is illegal to mislead consumers about coverage or exclusions wilfully. If you're ever in doubt or want to challenge how a term is being applied, you can contact the Australian Financial Complaints Authority (AFCA) to lodge a dispute.

Call Sheen first

If you're ever involved in an accident or navigating a tricky insurance claim, trust Sheen Panel Service to protect your interests. We're here to help car owners avoid falling victim to common insurance scams and delays by providing expert support from start to finish.

Our team works directly with policyholders and insurance companies to streamline the claims and repair process. When you choose Sheen, we’ll:

• Arrange towing and replacement vehicles immediately after your accident.
• Repair your vehicle to the highest standards using genuine parts.
• Liaise with your insurer to ensure your claim is processed quickly and fairly.

If you're ever involved in an accident or navigating a tricky insurance claim, trust Sheen Panel Service to protect your interests. We're here to help car owners avoid falling victim to common insurance scams and delays by providing expert support from start to finish. If your insurer is stalling or has rejected your claim, here’s what to do next.

Don’t let insurance confusion or misleading tactics slow you down. Get in touch with Sheen today and let us help you get back on the road—faster, safer, and with complete peace of mind.

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