Key industry figures took to the stage to put forward their thoughts on fighting fraud
Neil Daniel, GAB Robins
GAB Robins head of counter-fraud and investigations service Neil Daniel highlighted recent advances in fraud investigation.
“Possibly the best innovation is intelligence-led investigation,” he said, adding that GAB Robins had seen enormous benefits from this type of approach.
The firm carried out several inquiries before speaking with the claimant, Daniel said, which helped cut down the length of the claim lifecycle. In the past, serious investigation had only begun when an investigator met with the policyholder.
Data mining will become increasingly important in the future, Daniel predicted, adding that GAB Robins had recently turned down a £40,000 claim without even meeting the claimant, based on publicly available information they had collected. “It just needed the right skills and the right technology to uncover the information that we needed.”
He urged the audience to do more to tackle possibly fraudulent claims earlier in order to cut down on the average claim lifecycle. Industry databases such as the Claims and Underwriting Exchange were also important, he said.
Larry Jacobson, FICO
Data is key to helping find fraudsters, according to FICO insurance consulting engineer EMEA Larry Jacobson.
“It’s a war against crime out there, and to prepare yourself for any war you need an arsenal of weapons. Good data, good systems, good call centre operators who are well trained – these are all different weapons within the arsenal.”
He added that the use of predictive analytics software would rise as insurers sought to weed out more fraudsters. “Business rules will go so far, and they will catch the stuff you know about, but there’s a lot sitting under the surface that you don’t know about, and that’s where you need some heavy duty predictive analytics.”
Voice analysis and link analysis are other important tools that Jacobson expected insurers to use more often. He predicted that video conferencing could become widespread in the future, adding that countries that included a face-to-face interview in the claims process caught a lot more fraudsters.
Capturing the right data on a claimant and then applying that data well was key, Jacobson said. “I don’t think it’s a claims problem. I think it’s a problem from underwriting new business, right the way through to claims and post-claims.”
Paul Holmes, DWF
First-party fraud could often be tackled on indemnity points, said DWF head of fraud and technical insurance Paul Holmes. “Indemnity is often a way to defeat these claims when we cannot prove categorically that the individuals have been involved in a crime,” he said. “There are more ways to defeat a claim than simply being able to prove a claim is fraudulent.”
He gave an example of a restaurant burning down, where the business interruption claim was later turned down on an indemnity point after fire accelerants were found in the wreckage. Holmes found links between the restaurant, accident management firms and a garage raided for drugs and money-laundering offences. “Are we considering these ties to crime, and are we doing that investigation to find those ties to the higher level of criminality?” Holmes asked.
He advised the audience to make sure their claims handlers were well trained on issues of indemnity, non-disclosures and misrepresentation. “The public expects us to be fighting fraud,” he said. “Often you can have one thing that doesn’t look fraudulent that outweighs all fraudulent aspects of the claim.”
Let’s be proactive
“Some of the conversations today I’ve been hearing for 10 or 15 years. We should be thinking about a strategy. There’s more fraud than the insurance handlers can deal with, so we can’t just be reactive. The police are going to be less interested than they ever were.” Allianz insurance fraud manager Mihir Pandya
Watch the labels
“As part of screening and filtering, we might find problems with claims, but we should be very careful about calling them frauds. We should be very careful to benchmark what we mean.” Direct Group head of investigations services John Baldock
“It’s about educating the client. Are brokers generally doing enough ourselves? When we go through the question set for online or paper proposals, should there be a warning at the critical part of the question set, something like: ‘Failing to give a correct answer to the following could lead to the claim being refused and the policy being voided’? Do we just assume the client is a good guy?” Crown Insurance Consultants senior broker David Martin
Ask the question
“Insurers know that one in five of the adult population has an unstated criminal conviction. So why will they not ask that question on aggregator and comparison sites?” TR Youngs head of special risks Neil Cook