Preventing Phone Scams: How to Protect Yourself and Your Finances

Key Takeaways

• Scammers use urgency and fear to trick victims. Most phone scams rely on creating panic or excitement to push people into sharing sensitive information without verifying the call.
• Caller ID can be faked, so always verify directly. Never trust a phone number alone—spoofing technology allows scammers to make calls look legitimate even when they aren’t.
• Prevention starts with caution and reporting. Don’t share personal details over the phone unless you’ve confirmed the caller’s identity. Report suspicious calls to the FTC or state consumer protection agencies.
• Your insurance agency can help protect your information. A trustworthy agency will never pressure you for sensitive data over an unsolicited call and can confirm any communications directly.

Phone scams have become one of the most common types of fraud today, costing Americans billions of dollars every year. Scammers use sophisticated tactics to trick people into sharing personal information, sending money, or granting access to financial accounts.

As an insurance agency, we understand how important it is to protect sensitive information like Social Security numbers, banking details, and insurance policy information. That’s why we’ve put together this guide to help you recognize, prevent, and respond to phone scams.

Why Phone Scams Are So Effective

Phone scams work because scammers know how to exploit trust and fear. They often pretend to be someone you know or represent a company or government agency you rely on. The caller may claim there’s a problem that needs urgent action—a past-due bill, a policy issue, a legal threat—or even an exciting opportunity like a lottery win or a refund.

The goal is to catch you off guard so you respond quickly without verifying the call. Even savvy individuals can fall victim when the scam seems convincing enough. This is why learning to spot red flags is critical.

The Most Common Types of Phone Scams

Scammers use different stories and tactics, but there are some scams you’re likely to see again and again:

Impersonation Scams

The scammer pretends to be from the IRS, Social Security Administration, Medicare, or even your insurance company. They often say there’s a problem with your account or coverage and pressure you to share sensitive information.

Tech Support Scams

These callers claim your computer or phone has been hacked or infected with a virus. They may ask you to pay for “repairs” or try to convince you to give them remote access to your device.

Prize or Lottery Scams

In these calls, you’re told you’ve won a prize or lottery, but you need to pay fees or taxes upfront before claiming it. Real contests and sweepstakes never require payment to claim a legitimate prize.

Debt Collection Scams

Scammers pretend to be debt collectors, claiming you owe money and threatening legal action or arrest if you don’t pay immediately. Real collectors must provide written verification of any debt before demanding payment.

How to Protect Yourself from Phone Scams

Preventing phone scams starts with a few simple but powerful steps.

Always Verify Before Sharing Information

No legitimate business, including insurance companies and government agencies, will ever demand sensitive information or payment over an unsolicited phone call. If someone asks for this information, hang up and call the organization directly using a number from their official website or your billing statement.

Don’t Rely on Caller ID Alone

Scammers can “spoof” caller ID so it looks like the call is coming from a local business or even a trusted agency. Just because the number looks legitimate doesn’t mean it is.

Sign Up for the Do Not Call Registry

Registering your number with the National Do Not Call Registry can reduce legitimate telemarketing calls. While it won’t stop scammers entirely, fewer calls make it easier to spot suspicious ones.

Use Call-Blocking Tools

Most mobile phones and landline carriers offer call-blocking services to help reduce spam and scam calls. There are also apps specifically designed to detect and block known scam numbers.

Be Wary of Urgent or Threatening Language

Scammers often say things like “act now,” “you’ll be arrested,” or “your account will be frozen.” Legitimate companies rarely use scare tactics to force immediate decisions.

Report Suspicious Calls

If you receive a suspicious call, report it to the Federal Trade Commission (FTC) or your state’s consumer protection office. Reporting helps authorities track scam activity and warn others.

What to Do If You Think You’ve Been Scammed

If you shared personal or financial information with a scammer, act quickly to minimize potential damage. Contact your bank or credit card provider to freeze accounts or dispute charges. Place a fraud alert on your credit reports through Equifax, Experian, or TransUnion. You may also want to change passwords and enable two-factor authentication on accounts where possible.

Reporting the scam to the FTC and local law enforcement can also help authorities track patterns and potentially prevent others from being victimized.

FAQs

How can I tell if a call from my insurance company is legitimate?

A real call from your insurance provider will come from a verified phone number, and the representative will give you a way to confirm their identity—such as calling the main office number or sending information through your secure client portal.

Should I answer calls from numbers I don’t recognize?

It’s safer to let unknown calls go to voicemail. Most legitimate callers will leave a message with contact information so you can call back on your own terms.

Can scammers access my information just by me answering the phone?

Simply answering the phone doesn’t give away your personal information. The risk comes if you share sensitive details or follow instructions without verifying the caller first.