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Stepping up to the fraud challenge

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STEPPING UP KEY TAKE-OUTS While insurers have taken steps to tackle claims fraud, they now need to stop dishonest individuals being taken on their books in the first place by identifying those who are manipulating their data pre-inception. Research by SSP showed over 55% of consumers felt it was acceptable to change their personal details across multiple applications to find the best price for their policy. This behaviour has resulted in a potential £1.42 billion loss of motor premiums in the broker channels and only 22% of insurers feel they are successfully dealing with pre-inception fraud. Across the board, insurers have responded to application fraud by loading their prices, with every UK policyholder paying an extra £50 on their annual insurance bill. Yet by being able to identify dishonest individuals in real-time across the whole market, insurers can write the risks they wish to write at the correct premium and decline the risks that are clearly suspicious. Progressive insurers are already adopting innovative solutions such as SSP Verify to monitor the behaviour of individual customers in real-time across the whole insurance market to pinpoint when application fraud is occurring. In just 24 months' time, we predict 40% of insurers will have successfully implemented counter-fraud solutions and be reaping the rewards. Those insurers who do not respond now will be left with a murky pool of higher risk business. They will need to continuously load their prices to compensate for the fraudulent behaviour they are not detecting – making them less and less competitive against their progressive counterparts. So the question remains – will you be riding the wave or creating it? TO THE FRAUD CHALLENGE

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