Best Practices for Combating Fraud in the Insurance Industry
Today’s fraudsters are nothing if not resilient. After all, combatting fraud is often compared to a game of “whack-a-mole” —and for good reason. Just as organizations across all sectors are continually developing new ways to prevent fraud, fraudsters are continually developing new schemes. While a new anti-fraud measure may help decrease one type of fraud, it won’t prevent fraudsters from committing fraud altogether.
The ramifications of this “whack-a-mole” dynamic are particularly evident throughout the insurance industry. While fraudsters have long targeted financial institutions, the landscape has changed substantially in recent years. Following the implementation of comprehensive anti-fraud measures driven largely by stringent regulatory requirements, the financial sector has become a less feasible target for many fraudsters. In response, those seeking easier-yet-lucrative targets are setting their eyes on different industries— including insurance.
Sought after for their access to an abundance of customers’ proprietary information, insurance companies have become highly-desirable targets for fraud in recent years. And because insurers have historically faced fewer regulatory requirements pertaining to information security, the industry has generally been less cognizant of the threats and subsequent business risks posed by various types of fraud.
Fortunately, more insurance companies are recognizing that when it comes to combating fraud effectively and mitigating these risks, the “whack-a-mole” outcome doesn’t have to be inevitable. Rather than waiting for new types of fraud to surface and manifest in various forms of financial and reputational damage, many insurers are seeking proactive visibility into emerging schemes before the damage is done.
Indeed, insurance companies that integrate Business Risk Intelligence (BRI) into their anti-fraud programs continue to glean actionable insights from the Deep & Dark Web communities where fraudsters congregate and develop new schemes. By applying these insights to inform and enhance anti-fraud controls, insurance companies can and do gain a decision advantage over fraudsters and other adversaries.
As an early adopter of BRI, insurance leader and Flashpoint customer Aflac not only leverages this decision advantage to address fraud and other threats, the company holds its anti-fraud programs to the same standards as those implemented across the financial sector. BRI has since enabled Aflac to uphold it’s trailblazing “One Day Pay” initiative by making it quick and easy for the company to identify, investigate, and take action against suspicious claims before losses occur.
In the words of Aflac’s DJ Goldsworthy, Senior Manager of Threat and Vulnerability Management, “This type of proactive mitigation has been invaluable because it really affects the bottom line across the entire company.”
To learn more about how Aflac leverages BRI to combat fraud, download the case study here.