No Such Thing as Coincidence in Fighting Insurance Fraud

It may be a coincidence, but the fact that two of the leading technology vendors with solutions to help insurance carriers fight fraud have released new versions of their software within days of each other seems to be a sign that carriers are pushing for more ways to keep from throwing money away to cheats.

The need for better tools to fight fraud is never ending. The only thing you have to admire about those who commit insurance fraud is their commitment to their work. They are constantly looking for new angles to beat the insurers, which is why carriers can never afford to relax and think they have the upper hand on their counterparts.

The development of better software to fight fraud also is important because of the variety of fraud that impacts all lines of business. Fly-by-night construction companies ripping off homeowners—and insurers—trying to recover from a devastating natural disaster may not have much to do with workers' comp cheats or personal auto injury scams, but such widespread activity is why the work of special investigation units is spread thin.

But fraud detection doesn't have to reside on a server in the home office any more. Mobile technology—the better mousetrap for virtually all that we do—is arming consumers with apps that have to make any insurance adjustor or SVU thankful for the help.

Whether it is an app to check a contractor's license or one to record auto accident information that may seem suspicious, the battle is on to carve out some of the billions of dollars lost annually through illegal schemes.

 A little over a decade ago, I was new to this business and I asked one of the editors of our company's FC&S Bulletins why so many insurers did not have an active fraud prevention plan or special investigation units to uncover fraud.

"Many carriers look at fraud as the cost of doing business," he said.

Fortunately, that attitude has disappeared, thanks in large part to technology, which can now sort through the data insurers have gathered and apply analytics tools to discover links and trends of those who would cheat insurance carriers.

Of course, fraud cheats all of us since carriers usually find a way to pass along their losses to consumers. In a world where people commonly utter "I got mine," many people finally seeing beyond their own greed, which can eventually save money for all of us.