Solution Brief
Insurance claims fraud
Make better and faster decisions by quickly detecting and managing fraud.
The issue
Fraud losses represent a systemic risk to the profitability of every insurance company. Approximately 10% of all property and casualty insurance claims involve fraud – in many countries, this amount is significantly higher. Effectively tackling insurance claims fraud is a clear opportunity for insurers to save money, optimize expense ratios and maintain competitiveness in a dynamic market.
But tackling insurance claims fraud can be difficult. Reduced human interaction during the insurance customer life cycle allows fraudsters to flourish, with new tactics made possible by digital channels – such as online claims notification and management. In times of economic contraction or high inflation, fraud increases as underlying costs pressure consumers and businesses. Also, siloed data systems and sources can result in incomplete and unreliable decisions, negatively impacting the policyholder experience. Time-consuming and error-prone manual data preparation often results in too many false positives. At times, inconsistent claim handler approaches conflict with customer service goals.
Fraudsters also target multiple insurers, a web of deceit that can be difficult for a single insurer to detect. Several individuals may be involved in organized fraud networks, including claimants, doctors, solicitors, accident repair shops, vehicle hire agencies and accident management companies – all of which can work together to coordinate and obfuscate large-scale fraud rings, further hindering insurers’ detection efforts.
The challenge
Evolving claims fraud
The move to digital channels has increased fraudsters’ options. Organized crime rings are drawn to low-risk, high-return methods – causing insurers to pay for duplicate damage across multiple claims and policies. The use of third-party details and stolen identities can further impact this, making fraud networks extremely challenging to detect. With analytics from SAS, you can uncover previously unknown relationships among seemingly unrelated entities and identify new and emerging fraud threats.
Increasing policyholder expectations
Honest policyholders expect prompt payment of valid claims in an always-on, digital environment. High false positives negatively impact processing volumes, delaying legitimate payments and leaving fraud undetected. SAS helps reduce false positives with capabilities including network analytics, machine learning and explainable AI to ensure alerts highlighted for triage are incidents of provable fraud.
Missing data
With siloed information, sharing and spotting suspicious activity across product lines, departments or organizations is almost impossible. SAS consolidates real-time fraud intelligence in a single, intuitive platform containing dashboards, workflow, reporting, audit reports and case management.
Limited time and resources
Insufficient special investigative unit (SIU) analysts and investigator resources cannot effectively detect, triage and investigate all potentially suspicious activity. SAS finds fraud accurately through multiple analytic methods and layers of fraud detection to help SIUs and consortium investigations teams operate more efficiently.
Correctly identify fraudulent claims at the earliest opportunity
Our approach
Improving claims fraud detection means significant savings, increased profitability and lower loss-adjustment expenses for insurers. SAS’ scalable, comprehensive approach to claims fraud is based on experience with more than 1,400 insurance companies and several county-specific insurance fraud consortiums. We provide industry-leading software and services to help you:
Detect more fraud than current methods
Find fraud at the claim, transaction, entity or network level with our hybrid analytics approach and prioritize the highest-risk cases.
Increase per-investigator ROI
Stay focused on provable fraud and maintain consistent investigation processes with our advanced case management tools.
Quickly uncover organized crime rings and new fraud schemes
Assess all claims from the first notice of loss, visualize connections, and drill into data to prevent significant losses proactively.
Monitor claims fraud risk across all lines of business
Integrate the entire insurance claims fraud detection process, from data management to investigation, decision making and reporting, in a single, cloud-native platform that uses all internal and external structured and unstructured data.
Lower the total cost of ownership
Preconfigured detection scenarios promote faster implementation and a quicker ROI, and our solution's openness removes costly change request processes.
Figure: Social network diagrams give you a better understanding of new fraud threats so that you can prevent substantial losses early.
SAS difference
Incorporating all your internal and external data with AI and machine learning techniques helps you significantly improve fraud detection efforts. With SAS, insurers and insurance associations get:
Comprehensive data management
- Prepare and enhance data for fraud detection with insurance-specific data models and predefined data quality routines.
An advanced fraud analytical engine
- Uncover more suspicious activity using multiple analytics techniques, such as business rules, anomaly detection, predictive modeling and database searches.
Advanced text analytics and data mining
- Analyze structured and unstructured data to reveal otherwise unnoticed fraudulent activities.
Network link analysis
- Quickly discover organized fraud rings that often take months or years to stop.
Streamlined alert management
- Get consolidated and transparent alerts automatically prioritized and routed for investigation.
Configurable case management
- Increase collaboration and drive efficiencies in your investigation process through advanced workflows and intuitive page designs.
Flexible deployment options
- Use your cloud, our cloud or both. SAS can manage your deployment, delivering high availability and speed-to-value.