Application fraud: Intelligence and a united front bring progress

Application fraud can occur in many forms. It may involve applying for cover using a fake identity or manipulating information to obtain a cheaper premium. This could mean someone who drives extensively saying they need low mileage, or that a car is kept garaged or on a driveway when it is not. It also encompasses ghost broking and fronting.

There are significant benefits if insurers can establish an effective strategy to manage application fraud. Good systems, quality data sets and well-trained people will result in fraudsters being turned away early – and this is far more cost effective than having to investigate and refute notified claims.

With a rise in application fraud post Covid being widely reported, this spotlight sheds light on how insurers and brokers are using the art and data science of counter fraud to make sure honest policyholders do not suffer.

Topics covered include:
• Why application fraud remains a key threat for the insurance industry.
• Different types of application fraud.
• How the pandemic has put extra pressure on claims staff and counter fraud specialists.
• Why fraud may rise as the pandemic recedes.
• Educating policyholders about the consequences of manipulating applications.
• Ghost broking.
• Why sharing knowledge is key.