Use of anti-fraud technology skyrockets as insurers wage war against cybercrime
8 out of 10 insurers use predictive modeling to detect fraud.
Insurers using predictive analytics and other anti-fraud technology has skyrocketed to 80% up from 55% in 2018, according to the latest insurance fraud technology study by the Coalition Against Insurance Fraud and analytics and technology firm SAS.
The study revealed that insurers are using increasingly sophisticated technologies to foil cybercriminals It identified automated red flags (88%), predictive modeling (80%), text mining (65%), reporting capability (64%), case management (61%), exception reporting (51%), and data visualization/link analysis (51%) among insurers’ most used anti-fraud technologies.
According to David Hartley, Director of Insurance Solutions at SAS, this proves that insurers are agilely stretching their advanced analytics and AI capabilities to counter rapidly changing threats.
Cybercrime is one of the top risks for insurers in 2021. In the United States, insurance fraud causes more than $80b in losses annually.
Cybercriminals all over the world use phishing schemes, malware and even social media quizzes to steal sensitive personal information from unsuspecting consumers which is then sold in the dark web for illegal purposes such as identity theft or the creation of synthetic IDs using an amalgam of stolen and fabricated data. Scammers then use the identities to file bogus claims for cash or collect commissions from insurers for selling fake policies.
Cyber crime is also the insurance sector’s top risk globally and second in Asia Pacific according to PwC’s Insurance Banana report.