Modern Anti-fraud Technology Remains Lower Priority
Robert Regis Hyle | November 18, 2014
In case you didn’t realize it, this is International Fraud Awareness Week, so it seems like a good time to point out that estimates of fraud are no longer in the billions of dollars—they’ve reached the trillion dollar level.
How did we get this far? Too many people—including the people who run insurance companies—ignored the problem for far too long and somehow insurance fraud managed to gain a reputation as a victimless crime. Once the stampede began it was impossible to stop.
We are all victims, though, and we pay for it in increased premiums every day because, as we have learned far too often, it’s always the little guy—in this case the consumer of insurance products—that pays for the crimes.
At least insurers are paying more attention to what is happening around them, something that couldn’t be said 10 or 15 years ago. The bad news, though, is that not enough insurers consider it a serious enough problem to devote the time and resources needed to protect their company’s assets, and the premiums paid by their policyholders.
What is bothersome is that with all the advances in technology over the last few years, insurers are not taking advantage of what is available to them.
“The technology is definitely getting better, but there are still around 50 percent of insurers using very basic technology,” says Dennis Jay, executive director of the Coalition Against Insurance Fraud. “The percentage of insurers using anti-fraud technology has increased since our last survey in 2012. They just aren’t using cutting-edge tools.”
There is plenty of blame to throw around. One problem is the internal battle insurers face over resources. Look at your top five areas of technology concern within your business. Fighting fraud may be on the list, but who is fighting for those resources and who do you believe is going to win a debate between the VP of Underwriting and the head of the Special Investigation Unit?
Jay is hopeful about the future, though.
“P&C insurers are in better financial shape today and are loosening the purse strings so we see more SIUs expanding and some companies starting bigger and better units than they had before,” he says. “There always is going to be a problem with some segments of the industry, but overall it is getting better.”
Fraud awareness week seems like a good time to take an internal look at how fraud is affecting claims payments and profits. No one is going to like what they see, but let’s hope they are willing to do something about it.
- Enterprise Architecture in an Agile World
- Top 10 Tips for Securing Your Mobile Devices and Sensitive Client Data
- Industry Insight: 4 Global Insurance Trends in Digital, Data, Content Services and Security
- Diving Deeper into Prioritizing Your Strategic Digital investments
- Why Content Rules
- How Mass Personalization Will Open the Small Business Benefits Market
- At Year End 2017, Will Your Organization Be Protected from Cyber Risks?
- Do Insurance Bots Dream of Mitigating Risk?
- Conditioned to Respond
- Managing & Mobilizing Insurance Data in a Connected World
- Race to the Finish Line
- New Tools, New Opportunities in Claims
- ITA LIVE: Reaching Insurance Industry Crossroads
- Advice to Insurance IT Leaders: Keep Your Eye on the Ball
- New Date, Venue for ITA LIVE 2017
- Guidewire Makes Major Push to Small and Midtier Market by Acquiring ISCS
- Insurance Disruption is Happening Right Now
- Insurity Adds Strategic Investment Partner, General Atlantic
- Beyond Transformation: The Convergence of Finance, Risk, and Actuarial Functions
- The Rapid Evolution of Consumer Protection Regulation
- Talent Hunt: Finding, Attracting, Retaining Top People
- Insurers Flexing Their Distribution Models
- Technology Driving Disruption in Insurance
- Fear of ‘Next Bubble’ Challenges Life, Annuity Carriers
- Technology Allows Commercial Lines Insurers to Stand Out
- Single Sign-on Viewed as Biggest Tech Challenge for Agencies
- ISCS Observes 20th Anniversary; Scurto Predicts Major Changes Ahead
- Policyholders and Their First Impressions
- Progressive Making Progress on the UBI Front
- High and Dry: Insurers Search for Disaster Recovery Plans
- Insurers Sign The (Un)Dotted Line
- Reflections of a Retired Insurance CIO
- Mobile Device Management Just One Answer to BYOD Issue
- Lessons from GEICO and Progressive on Winning the Critical Buying Stage
- You Are a Target for a Cyber Attack
- Web-based Systems are the Next Evolution in Claims Technology
- Gaining a “Wow” Experience from Web Users
- Time to Shift from Business/IT Alignment to Business/IT Alliance
- Healthcare Insurers Changing to Consumer Model
- Organization is the Key for Selecting Software Vendors
- Analysts Expound on the Needs of the Mid-tier Insurance Market
- Finding the Cure for Obamacare’s Website
- New Software Solutions Benefit Insurers on the Inside and Outside
- Products, Market Impede Investment in Systems for Life Insurers
- Combatting Cyber Threats: Predict, Prevent, Persist
- The Future of Telematics Heads Beyond Insurance
- The Shame in Cyber Security Lapses
- Building Policy Administration Systems for the Future
- Insurers Look Into The Eyes of Their Policyholders
- It’s a New Dawn for the ITA
INSURANCE IT NEWS
- Visioning, Setting Scope, and Execution Planning Critical for Successful Digital Strategies, Says Novarica
- ITS Implements QA Best Practices for Rockford Mutual
- FireLight® by Insurance Technologies Features New Advanced User Experience Capabilities and Wizard Designer
- InsurTech Startup Betterview Launches New AI Driven Roof Report to Immediately Identify Roof Condition & Characteristics
- Larger Insurers Extending their Analytics Leads and Piloting Artificial Intelligence, says 3rd Annual Novarica New Normal 100 Benchmark
- 360Globalnet Augments Services and Implementation Capabilities
- TechCanary Incorporates in Canada as TechCanary Insurance Software of Canada ULC
- XL Catlin to Build World’s First On-Demand Cyber Insurance Solution with Slice ICS
The Email Chat is a regular feature of the ITA Pro magazine and website. We send a series of questions to an insurance IT leader in search of thought-provoking responses on important issues facing the insurance industry.
ITA is pleased to present the 2014 Webinar Series. We have many topics for you to choose from and attendance is open to all ITA members. The webinar topics are current and exciting — ranging from predictive analytics to telematics and will focus on the direction insurance carriers need to follow for the future. All webinars are presented by insurance IT professionals along with some of the leading analysts and consultants in the field. There is no cost to attend an ITA webinar. For more information and to register for the webinar, click the “title” of the webinar below.
BLOGS AND COLUMNS
It has become a common refrain over the past few years to view the practice of enterprise architecture (EA) as something that time has passed by, much... READ MORE
One important trend in society over the past decade is our increasing ability to create and consume a seemingly unlimited amount of digital content... READ MORE
You have surely heard it said that small businesses are the growth engine for America. Today, the phrase has a special ring to it for benefits... READ MORE
With stagnant growth and lingering low interest rates, the life insurance industry faces a challenging future... READ MORE
Finding insurance carriers willing to write commercial lines risks has always been a challenge for producers... READ MORE
As Guidewire Software prepares for the start of Connections, its 11th annual user conference that begins on Nov. 2, Brian Desmond, chief marketing... READ MORE
Fraud detection has always been and will continue to be a critical component of claims management. Learning the lessons from current claims Straight... READ MORE
- Vendor Views