Be sure to conduct a thorough background check and ask the agent a lot of questions to avoid being an insurance fraud victim. You may take these steps to clear any lingering doubts about the legitimacy of a broker or insurance policy: Verify with your state's insurance department: Call to confirm that the agent in question is licensed to sell insurance policies where you live. Confirm before signing your insurance contract: Don't commit to any deal or send any payments before verifying the legitimacy of your prospective agent. Avoid "cash-only" agents: As a general rule of thumb, be wary of any broker that doesn't want to leave a money trail behind after selling you an insurance policy. Always call to confirm the license status of an agent that only accepts cash payments.