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Is cutting-edge insurance fraud technology making a difference?

by | Sep 2, 2020 | Insurance Defense

Insurance companies have battled acts of fraud for as long as the industry has been in existence. Over time, technology has improved to fight these illegal tactics. Insurers have made significant investments to automate not only the reporting process but also implement predictive analytics and artificial intelligence to identify fraudulent acts that used to go unnoticed.

Yet, that financial commitment to innovate and stay on the cutting edge has led to a reduction in referrals. According to the Coalition Against Insurance Fraud, cases are in decline from 15 to 22 percent over the past two years.

With fewer referrals come fewer cases for field and desk investigators during a time when staffing increased by 16 percent, up from 2017’s nine percent. During the same period, special investigative units have had their budgets slashed by 20 percent.

Speculation surrounds a greater focus on quality over quantity with larger cases that involve massive fraud rings engaged in more complex scams valued at up to six figures. Those demand more resources for more in-depth investigations that could link hundreds of individual cases together. Currently, those investigations account for nearly 50 percent of staff workloads.

Industry veterans accustomed to pen and paper combined with others not familiar with the industry-specific technology will need the time to become comfortable with the innovative new normal. Over time, training and hands-on experience can fine-tune skills. Efficiency, effectiveness, and accuracy can go a long way to stop fraud, save money, and put those resources into future investigations.

Insurance DefenseIs cutting-edge insurance fraud technology making a difference?
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