Approximately 10% of all claims are fraudulent, according to industry estimates, and about one in five of those fraudulent claims are never even detected. That’s why insurers must optimize their fraud prevention and detection capabilities to keep them ahead of the perpetrators, who are becoming more and more sophisticated and wily. What kinds of claims fraud are presenting the biggest challenges or threats to insurers, and how are they dealing with these kinds of attacks? How are technologies such as big data and analytics helping insurers reduce claims fraud, and what are some other tools that are helping them in these efforts?
Identify Potential Fraud As Early As Possible
In terms of current challenges or threats, large commercial insurers are still highly exposed to single claimant slip-and-fall and staged accident schemes. We are, however, also seeing organized fraud rings increasingly involved in these schemes, and that presents us with a broader business challenge. To counter the organized fraud ring threat, we acquired technology tools, created a major case team and are actively involved with industry organizations such as the National Insurance Crime Bureau.
Our technology resources help to identify potential fraud as early in the claim handling process as possible. This helps to not only reduce potential fraud as a whole but also helps our claims colleagues and customers by reducing the time and resources that may have otherwise been lost had the potential fraud been detected much later. We also use a link analysis tool to illustrate connections between events, involved parties, locations etc. The link analysis tool is quite valuable in its ability to create a clear picture from many pieces of data.
— Brian K. Wilson, Vice President, Head of Special Investigations Unit, Zurich North America
Peggy Bresnick Kendler has been a writer for 30 years. She has worked as an editor, publicist and school district technology coordinator. During the past decade, Bresnick Kendler has worked for UBM TechWeb on special financialservices technology-centered ... View Full Bio