Using technology to tackle fraud
Today’s financial climate sees a growing need for Insurers to reduce operational leakage. Inevitably, fraud detection and prevention measures can assist greatly - but there is often a perception that such measures present a barrier to good customer service.
The IBM Global Business Services report characterises good service as easy interaction with the insurer, where desired outcome is achieved in as little time as possible.
Other publications on the subject claim that it is a combination of cost and poor servicing experience that causes customers to abandon their insurance provider. One article states that around 25% of policy holders fail to renew because they perceive they can get a better deal and service elsewhere.
Undoubtedly, the insurance industry should aim to provide excellent customer experiences; however, when servicing claimants, it must be acknowledged that 10% to 20% are often willing to misrepresent material issues in order to falsely secure higher compensation. Consequently, advanced validation techniques are required to assist in quickly and painlessly identifying the genuine majority, fast tracking them to the swift and efficient support/settlements they really do deserve.
Thankfully, solutions and technologies are now available that greatly assist organisations in doing exactly that. Such cutting-edge solutions can not only improve customer experience but simultaneously beef up fraud detection rates. Real ‘fast-tracking’ can be achieved quickly and confidently. More traditional validation and investigation activities can be reserved for cases that reveal relevant risk. Implementing the right mechanisms to preserve ongoing relationships with genuine customers - whilst weeding out the cheats, can only be win-win in the long term.
With most Insurers recognising that fraud related leakage can no longer be absorbed by either premiums or constrained budgets, there are many that are proactively addressing the need for change, turning to these cost-effective solutions that really do what is required. They are then able to see highly significant ROI’s and a renewing pool of happy, genuine customers. Win-win.
Lior Koskas is business development director for Digilog UK.