Technology A Double-Edged Sword Against Insurance Fraud
INSURANCE FRAUD IS ON THE RISE AROUND THE WORLD AND INSURERS HAVE STARTED TO FEEL THE PINCH. IN 2013, GENERAL INSURERS DETECTED 118,5001 CASES OF ATTEMPTED CLAIMS FRAUD IN THE UNITED KINGDOM WHERE 12 IN EVERY 10,000 APPLICATIONS AND CLAIMS WERE FOUND TO B
Populated cities such as Brazil, home to one of the largest insurance markets, are also being hit where the cases of suspicious incidents, detected fraud and proven fraud totalled R$2.6 billion of total business in 2011. It is estimated that cases of fraud are between 10 to 15 per cent of total claims paid, amounting to R$3.6 billion a year. Industries most susceptible to this are auto insurance, life insurance, health insurance, and property insurance3. According to Experian’s 2014 Interim Fraud Report, first party claims remain dominant, accounting for almost 80 per cent of all fraud claims4, putting pressure on the need to detect fraud at the point of application.
ASIA PACIFIC HAS TREMENDOUS EXPOSURE TO FRAUD WITH ADVANCEMENTS IN TECHNOLOGY
In the Asia Pacific region, this trend is also picking pace. In 2011, insurance claims fraud cost Malaysia an estimated RM12 million. Even in Singapore, according to the General Association of Singapore, it is estimated that the percentage
1 ABI UK Insurance key facts 2014 2 Experian Interim Fraud Report 2014 3 Survey of the National Confederation of General Insurance, Private Pension and Life, Health Insurance and Capitalization (CNseg) 4 Experian Fraud Report 2014