The disconnect between underwriting and claims is oft lamented.The undercurrent of animosity that exists between the two—whichsome construe as conflicting fiefdoms; or simply conflictingpriorities—is a multi-faceted problem that we have no delusions ofadequately exploring in this one article. Suffice it to say, asidefrom exacerbating bruised egos and awkward encounters at thecompany picnic, lack of collaboration between the two takes asignificant toll on insurers' ability to effectively assign andmanage risks, assess adequate premium, and control claimscosts.

Compounding the issues associated with this communicationbreakdown is a vague air of depersonalization that has seeped intovirtually every nook and cranny of the industry. For the sake ofexpediency and process cost reduction, in both claims processingand managing policies, there has been a proliferation ofself-service options. Within the capabilities of modern technologies, consumers may now seek coverage andclaimants can report loss incidents often with virtually nil humaninteraction. Consequently, insurers are losing contact with theirpolicyholders, as neither may be able to associate a “face” or“personality” to the other. Behind the guise of anonymity (orimpunity) afforded by the Internet, including “how to scaminsurers” tutorials, consumers are able to execute what may end upbeing a deceiving self-service policy and claim reporting options.This subset of carrier customers make it their business to know asmuch as they can about automated rating and claim handlingpractices so as to intentionally misrepresent their circumstancesto obtain lower auto and homeowners' policy premiums, therebysetting the stage for higher claim payouts completely unrelated tothe risk they realistically represent.

Also galvanizing scammers is the unfortunate publicmisperception of insurance fraud as a “victimless crime.” Thus, forinsurers, the best defense is defining and meticulously executingspecific fraud-detection programs, which encompass the right people,processes, and technology that marry quality claims andunderwriting data.