Fraudsters never rest and Lior Koskas, managing director of Digilog UK, urges the industry to remain open to sharing in the latest risk identification tools and continually review procedures for fraud.
Currently the civil liberties of genuine people are being infringed by the increasing numbers of fraudsters whose activities dictate that everyone else must foot their bill. With the UK fraud bill estimated to be at least £193bn, organisations would be failing in their duties to their stakeholders if they did not test new and emerging methods and technologies that can assist in reducing this exposure.
Most recently, many insurance corporations have been inconvenienced by repercussions brought about by changes to the discount rate. And, with insurance premiums on the rise, insurers have identified an increase in opportunist fraud. Subsequently there has never been a more important time for such companies to contain costs.
Now more than ever, swift and accurate risk identification is essential and many companies are steering towards in-house real-time risk assessment so as to instantly assess the level of risk posed, saving considerable time and money in relation to operational costs and outsourced investigations, as well as reducing loss ratios substantially.
Nonetheless there is a perception that where the claims cycle is reduced, in-depth and effective validation may be compromised. Yet, live video streaming from crash sites or voice risk analysis in call centres mean that claims are never denied on anything other than traditional evidence emanating from robust validation work, only the process is sped up somewhat. On the whole, innovative technologies working in conjunction with internal legacy systems support a more robust risk assessment scheme, focusing only on the relevant risk issues, to either assist in eliciting tangible evidence of crime or to manage the case away.
‘Treating customers fairly’ is a phrase pertinent to training sessions. To be customer-focused does not mean to entertain a fraudster on the pretence that if we flag their claim for further validation, they may lodge a complaint in relation to conduct or length of process. Instead, innovative software may be used to support general procedure enabling fast-tracking of genuine claimants and pass those who are potentially deceptive for further checks, all the while upholding a high level of customer service.
On the flip side, where individual rights are asserted, it has been argued that such use of technology could be perceived as an infringement of civil liberties. However, if used in the correct way and for the correct purpose, the industry can be sure that only those with criminal intent will perceive it as an infringement upon their liberty, that is their ‘freedom’ to commit crime. Just as with shoplifters and CCTV, only cheats and thieves have anything to fear from sensible crime prevention measures that take advantage of scientific progress.
Sadly, after a period of time, most approaches are overcome by fraudsters. Besides, since the attrition of staff is endemic throughout the industry, such approaches may be known to all – worryingly, the insider threat when they become outsiders is a case in point. On these grounds, we are often quick to dismiss the latest proposal. Yet, it is important to scrutinise emerging technologies in order to ascertain their potential and carefully consider investment.
Understandably, where daily processes are well established, the introduction of something new may be considered a hindrance as opposed to a help. However, it is vital that those within the industry remain open to sharing in the latest risk identification tools and continually review procedures so as to crack down on fraudulent activity.