Page 28 - Insurance Times July 2021

o The variables considered for analysis can be They take following initiatives to spread awareness about
customer demographics, policy information and Fraud awareness.
intermediary behavior. Based on statistical analysis, Y Theme based poster competition for employees.
significant variables can be derived for the Y Online quiz on Fraud Management.
predictive model.
Y Mouse pad with Fraud Management message - gets
Again this is one-time cost for insurer. distributed to all employees.
Y Policy Servicing Stage Y Fraud related videos gets created highlighting effects
o Customer walking mandatory for policy servicing of misconduct
changes. (Address Change/ Nomination Change). Y Coffee mugs with Fraud Management theme based
o Thorough check of high value customers before any logo.
payout. Y Pledge Calendar aimed on personal ethics & Conduct.
o Roll out of ORMS [Operational Risk Management
System] wherein Risk aspects is checked in all stages Now, let us see few examples wherein cost involvement is
of policy servicing. almost negligible.
o Creation of an incident reporting platform and A) Insurance Fraud Controls through Profiling
awareness to employees for reporting any the Fraudster:
suspicious /fraudulent instances. Pre-planned fraudsters
First two initiatives will not require any cost, but Y Who start out from the beginning planning to commit
last two initiatives will require one-time fraud.
infrastructure investment for the insurer. Y Can be short-term players, e.g. who use stolen credit
Y Claims/ Surrender Stage cards; or can be longer-term, like bankruptcy fraudsters
o Fraudulent Death Claims Detection Model: To & those who execute complex money laundering
predict the chance of a claim proposal, resulting schemes.
into fraudulent claims using statistical model. Intermediate fraudsters
o Very Early Death Claim Analysis [VEDC]: Early Death Y Who start off truthful but turn to fraud when times get
claims which gets reported within one year of policy tough or when life happenings, such as annoyance at being
issuance is considered to be very early death claim. passed over for promotion or the requirement to pay for
Analysis to be done on a monthly basis on VEDC. care for a family member, change the usual mode.
Call for initial observations from the Sales Slippery-slope fraudsters
Intermediaries and Branch Head for all very early Y Who just carry on trading even when, objectively, they
death claim intimated during the particular period. are not in a situation to pay their debts. This can apply
Actions can be initiated, if any adversity found. to normal traders or to key business people.
o Roll out of Fraud Risk MIS (Online MIS reports): The
very early death claim reports can be provided to B) Insurance Fraud Controls through Fraud
Prevention:
sales personnel. These reports can be built and
mapped as per the sales hierarchy. Death claim
intimations can be populated on real time basis.

o Industry Feedback: Flagging of policies based on
negative feedback received from the Industry.
These Initiatives will require one-time cost for the insurer. Fig. 5 - Fraud Controls through Fraud Prevention

Insurance Fraud Controls through How to Establish a Sound Ethical Culture
Awareness sessions on Frauds in any Organization:
Fraud Awareness Day Y A mission statement that refers to quality or, more
Many companies celebrate fixed dates of a year as Fraud unusually, to ethics and defines how the organization
Awareness Day. wants to be regarded externally.

28 The Insurance Times, July 2021