“Insurance fraud is a continuous game of cat-and-mouse,” explains James Quiggle, director of communications for the Coalition Against Insurance Fraud (CAIF). “Investigators build a mouse trap, but then swindlers build a better mouse. The industry's best defense is amassing field intelligence and analysis and then throwing that up against a ring.”

While detection and investigation have become far more scientific, the technology and methods are only as effective as those utilizing them. Staff must be apprised of proper data-mining techniques, and the insurer must be willing to cultivate a system-wide awareness of fraud at all levels of the company and programs for identifying and disseminating clues to the special investigative unit (SIU).

“Going after fraud simply doesn't fall on the shoulders of SIU alone,” says Quiggle. “There must be a companywide commitment and training throughout all layers of the corporation. Information that may contain clues is coming from all directions, so adjusters, underwriters and even customer-service reps must all be trained in fraud detection and uniform protocols to share that data.”

Mining social media for clues is now an essential investigative tool for insurers, as well. “People love to brag about their scams and don't know what they are up against—namely a sophisticated analytical force scouring the Internet for every possible clue for behavior,” Quiggle adds.

He relayed one example in which an insurance company investigator came across a bicycle club to which a claimant belonged. The avid cyclist bragged about a recent 50-mile ride, all while claiming to have been “flat on his back” because of an injury at the office for which he was receiving Workers' Compensation benefits.

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