The Insurance Times Fraud Charter went virtual back in May, director at Carpenters Group Donna Scully discusses how insurance fraud is evolving especially with the rise of home working during lockdown
We all know from long experience that fraud adapts as regulation, technology, and opportunity changes. With so much of our way of life being deeply impacted by the coronavirus pandemic, it is inevitable that insurance fraud is evolving too.
The Insurance Times virtual Fraud Charter group heard that the IFB Fraud Taskforce has met to look at the emerging Covid-19 fraud threats. The General Insurer Fraud Committee has also circulated a paper to the industry and set up tactical workshops to cover key areas of concerns. Insurers, too, have conducted internal assessments. More communication with customers can be expected warning of the risk of scams and seeking to dissuade those who might be tempted.
Developments from home working are probably the number one concern. Are home-working staff more susceptible to being approached to sell data? Can firms maintain data security when staff work remotely? Are signs of fraud more likely to be missed? Application fraud is also high up the list. With fewer applications and claims, it should be easier to monitor for fraudulent behaviour, but could become harder when volumes pick up as we emerge out of lockdown. Will economic desperation drive more opportunistic fraud? The industry is certainly alert to the fraud threat.
The Fraud Charter group heard there are already signs of gaming. Credit hire claims are lengthening, with repairers saying clients must pay for a deep clean due to the risks of Covid-19 and quarantining vehicles for 14 days before work can start.
Aside from claims management company (CMC) behaviour, factory claims and staged accidents, there are fears CMCs may see an increase in accidents at home under occupiers’ liability law and there was also mention of CMCs already looking at bringing Covid-19 claims against employers.
David Parkin of the Ministry of Justice (MoJ) was asked why the department is not getting involved in protocols and ways to keep the court service functioning.
Given that it is voluntary, is there a risk that those who do not participate might be opting out to take advantage of the situation? He thought the industry was working well together by developing the protocols and accepted that the MoJ was under pressure due to Covid-19.
The group also discussed the need to rebuild the reputation of insurers after the bad press over business interruption claims and impending representative actions over coronavirus.
Paying good claims without delay and paying suppliers promptly were two actions identified. I suspect I was not alone in thinking it will take more than that.
Read more…Fraud Charter: Opportunistic application fraud will get worse due to lockdown financial hardship
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