Insurance claims fraud has been a consistent source of frustration for carriers for decades. Despite their best efforts, insurers are still left paying millions of dollars in fraudulent claims annually. According to the FBI, the total cost of insurance fraud is more than $40 billion per year.
Unfortunately, that impact trickles down to consumers, who in turn are paying anywhere from $400 to $700 per year in increased premiums.
Fortunately, there is light at the end of the tunnel.
While totally eliminating insurance fraud is highly unlikely, carriers have a new weapon that is changing the game — insurance fraud analytics.
Through advanced data technology made possible by digital insurance tools, insurers are finally getting ahead of the criminals executing fraudulent schemes.
Traditional fraud detection models are very time-consuming and costly for insurers, as claims were often largely paid out before the fraud was concretely proven. Today, insurance fraud analytics is speeding up and improving the accuracy of fraud detection.