VFM results show that old-fashioned claims handlers have the upper hand over lie detectors, says Ben Cook
The impressive results scored in AXA's recent VFM anti-fraud trial have reverberated around the industry.
A massive 45% of claims went unpaid after claimants were screened using VFM's conversation management technique. This represents a significant increase on the figures produced by Digilog's lie detection technology.
When Admiral used lie detectors to screen motor theft claims, only 20% of claimants withdrew their claim.
Despite insurers falling over themselves to employ lie detectors when handling claims (Admiral, Allianz Cornhill, Cox, HBOS, Highway, Royal & SunAlliance and Zurich have all put their faith in the technology), it seems that there is a more effective way to root out the fraudster…the good old-fashioned claims handler.
The VFM approach does not rely on hi-tech gadgets to spot the cheats, it merely relies on the tried and trusted savvy of experienced interviewers.
And the results speak for themselves. It's estimated that the VFM experiment saved AXA around 38% of the amounts notified by claimants.
So, while lie detectors might have captured the imagination, it seems that the VFM technique is producing the better results.
While many of the big names have taken the plunge and signed up with Digilog, equally big names, such as Norwich Union, have remained sceptical. This scepticism has been justified by the results of the VFM pilot.
Most alarming for the insurance industry is the news that fraud could be ten times more prevalent than was at first thought. Only 4.2% of claims went unpaid before AXA used VFM, but this figure increased to 45% once the claims went through the screening process.
Whether you're a Digilog fan or a follower of the gospel according to VFM, one thing that all agree on is that the insurance industry has to step up the fight against fraudsters.
It's estimated that the insurance industry loses around £20m per week to insurance cheats. Insurers desperately need to start eating away at that figure. VFM has shown them the way.
