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ICICI Lombard Expert Blog
 

Are We Better Than The Americans in Detecting Insurance Frauds?

November 30 2018
insurance-fraud

Indian insurance companies are two times more likely to detect fraud than Americans

According to the Trans Union CIBIL Fraud Trend report of 2018, finance and insurance companies in India are twice more likely than their American counterparts to detect a fraud. The survey also mentioned that about 62% of Indian financial firms believe that the many solutions to detect and prevent insurance frauds lack flexibility to adjust in real time.

The survey showed that one of the major problems faced by the insurance companies here is the verification of identities as fraudsters are involved in three main types of fraud, i.e. identity theft, soft fraud, and hard fraud. The companies also struggle with end-to-end authentication process, which results in poor customer experience.

While hard frauds pertain to deliberate display of loss to the policyholders or the applicants, soft fraud is providing wrong information about the premium amount or the claim value. On the other hand, identity theft relates to using the stolen identity to apply for insurance or file a claim.

According to the survey, nearly 75% of financial services companies are worried about their return on investment (ROI) of their fraud detection and ID verification solutions, while also providing exceptional experience to their customers.

The Managing Director and CEO of Trans Union CIBIL said, “Customers are demanding exceptional experiences throughout the insurance process. This means that false alerts, detection, prevention procedures and the investigations that go with it can negatively impact their customer experience.”

*Source: Financial Express

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