How Technology Helps to Battle Insurance Fraud
Insurance fraud is prevalent across the entire industry, unfortunately, and it does not select favorites when it comes to claiming a next victim. The most efficient way to fight fraud today is through technology. Agencies are able to detect fraud faster and more reliable than ever with the use of technology. There are a few ways agencies are using tech to do this.
Fraud steals $80 billion a year across all lines of insurance, according to the Coalition Against Insurance Fraud Estimate.
That’s a staggering number considering the technological advances around today to help prevent such fraud from occurring. So, what can agencies do to help lower this number?
Check it out: Insurance Fraud, How Bad Is It Really? (Infographic)
Technology and the use of data and analytics are making their presence felt across the whole industry. These technologies are used by agencies to not only detect fraud but to also help increase prevention before it happens. The ability to get in front of fraud and have a chance to prevent it before it occurs is revolutionary to the industry. Being proactive about security will make all the difference if and when fraud comes knocking on your agency’s door.
Eighty-one percent of respondents reported using automated red flags according to the Coalition Against Insurance Fraud, 2014 study.
Automation is a fairly standard tool used in insurance technology today. Through automation, red flags will indicate when a claim appears to be odd or raise a concern. Red flags can be raised for a number of things when claims are made, including the claim being made just after there is a change or increase in coverage, damaged property is insisted to have been the most expensive model of its kind without receipts, or the insured person asks the agent hypothetical questions about coverage in the event of a loss very similar to the actual claim made. There are countless amounts of red flags that can be brought to the attention of investigators and agents, but oftentimes, these flags are not evidence of an insurance fraud when they stand alone. When they are present in a claim, they should be reviewed thoroughly.
Check it out: Digital Transformation of Insurance In 2017
According to a Coalition Against Insurance Fraud study, nearly 75 percent of insurers use automated systems to detect false claims — a large increase over the 2014 and 2012 studies.
Check it out: Leveraging Technology To Make Your Agency Productive
Data can be overwhelming to filter through but can also be one of the most useful resources insurance agencies can use to detect and prevent fraud. Tracking and getting the most out of data will be a great benefit to any insurance agency wishing to get ahead of fraudulent claims.
One of the most unexpected places to collect valuable data is in fact through social media. That’s right. Social media is a very telling place to learn more information about claims that may have some red flags, or just to gain more information about a claim that has been made. Social Network Analysis, or SNA, is a type of social networking where people build relationships via platforms like Facebook, Twitter, and LinkedIn, which may be unknown to insurance agents at the time of a claim. Insurance agencies and investigators use this non-private data from their customers to get to the bottom of claims. Sometimes, social media helps agents uncover the truth about a claim made, learning it is fraudulent. These discoveries are made through photos posted by the insured of stolen objects claimed to be lost, but are recently shown in the photos, posts attempting to sell items in the past that are now claimed to be stolen, or even a change in a job title when the insured is receiving disability benefits. Evidence like these cases can happen and are a strong resource to have for an insurance company to win in a case of insurance fraud.