With the economy floundering, businesses struggling to survive and employees losing their jobs by the hundreds of thousands every month, it is not unreasonable to anticipate increased fraud activity against insurers of all stripes by desperate claimants.
Technology vendors have been hard at work developing and upgrading products designed to thwart such activity by leveraging customer data and other information sources. The following are some of the most recent product offerings:
o SPSS offers a suite of predictive analytics software and solutions designed not only to uncover existing instances of fraud, waste and abuse, but also to prevent future occurrences, the Chicago-based company said.
"Insurance carriers use predictive analytics to not only extract value from standard yes-no answers, but also detailed information and sentiments behind those answers," the company added. "They're able to instantly determine an immediate approval of an insurance policy or flag it as being potentially fraudulent by immediately sending an alert so it can be further investigated."
SPSS' "Risk Control Builder," specifically designed for carriers, helps evaluate risk in real-time using a combination of business rules, predictive models and information gathered from customer interactions to optimize the insurance claims-handling process.
The product provides a business-driven interface for defining risk areas and measurements, as well as a risk assessment engine for calculating risk in real-time based on historical information and data gathered at the time of customer interaction, the company said.
Cost: Implementations start at $100,000 and scale upward, depending on size of deployment and functionality, said SPSS.
SPSS' "Clementine" and "Text Mining for Clementine," which are data-mining applications, are used in the analyses of structured and unstructured data to discover patterns, anticipate outcomes and improve processes with the deployment and integration of predictive models, the company noted.
"Both can handle extremely large datasets," the firm said. "[The applications] solve a wide array of challenging business problems, including customer churn, campaign effectiveness, customer value, marketing cost, fraud and risk analysis."
Cost: Prices for both start at around $20,000, depending on size of deployment, the company said.
SPSS' "Dimensions," a data collection and survey reporting software, helps researchers and organizations proactively incorporate data pertaining to attitudes and preferences into analytical decision-making, said the firm. It allows users to take control of the entire feedback lifecycle–from developing surveys to managing the data collection process to conducting analysis to distributing results.
Cost: Pricing starts at $20,000 for basic Web interviewing, with additional costs based on number of interviews conducted and additional data collection products chosen, the company added.
The SPSS "Predictive Enterprise Services" platform provides a foundation to manage and automate the entire analytics process, said the firm.
Cost: Implementations start at $100,000 and scale up, depending on size of deployment and functionality.
SPSS' "Statistics" is a statistical software suite used to solve business and research problems, said SPSS. It extends the power of Predictive Analytics, from the non-technical user to the expert programmer/analyst, and improves utilization and productivity in data access, data preparation, analysis and reporting.
Cost: Pricing starts at $1,799, with additional costs per number of licenses and modules, the company noted.
o Computer Sciences Corp. markets "Fraud Evaluator," described by the company as "a fraud detection tool that combines several complementary technologies for detecting and managing suspicious claims, from the first notice of loss through the life of the claim."
According to Austin, Texas-based CSC, the product uses predictive modeling, identity search technologies and a fraud indicator rules engine to identify unique variables in the claim data indicative of fraud. Fraud Evaluator then triggers additional data collection and case management activities to uncover cases with the highest probability of fraud.
By using such tools that improve analysis at the first notice of loss and throughout the life of a claim, insurers can increase the rate of referrals for suspicious claims, CSC asserted.
"By automating much of the process, companies can make fraud detection a consistent practice throughout the department without placing more pressure on the adjusters to detect suspicious activity, and their special investigative units can close more cases and reduce fraud losses," the company said.
According to CSC, benefits from this software include:
o Reduced loss payouts and reserves
o Improved consistency and quality of referrals
o Improved productivity for adjusters, SIUs and management
o Relieving adjusters from being on the lookout for suspicious claims
o Automated workflow and statistical reporting
o Implementation of best practices for fraud detection
o Ensuring consistent review and evaluation across all claims
Models and rules are based on the insurer's historical fraud experience and can be refreshed periodically to recognize new patterns, the company noted.
In addition, through a Web browser, investigators can display a summary list of all claims referred to them, in order of highest score first. This allows investigators to work their way from most probable fraud to least probable, the company asserted.
Cost: The company declined to provide pricing information.
o ISO has released "ClaimSearch Illustrator," a desktop application that helps insurers visualize relationships among data elements within ISO's ClaimSearch claim records.
The product "uses pictures and icons to create presentation-quality graphics that display connections of data elements from the reports so it can be determined if a claim needs further investigation," said Jersey City, N.J.-based ISO.
The graphic visualization shows shared connections among data, such as a vehicle identification number linked to multiple claims or a claim linked to multiple parties, ISO explained.
"The software allows insurers to organize data in numerous ways, add data manually, and hide data temporarily to create an optimal visual picture that can help spot suspicious activity," said ISO. "In addition, a special function allows for merging variations of names and addresses to streamline the graphic visualization. There is also the ability to click on a data element to see key details that could help in reviewing a claim quickly."
Cost: ClaimSearch Illustrator is offered to customers at no charge, as part of their participation in the ISO ClaimSearch service.
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