Rise in application fraud for motor
Aviva have recently posted about a 16% increase in the level of motor insurance policy fraud (https://www.insurancebusinessmag.com/uk/news/auto-motor/aviva-warns-of-surge-in-motor-insurance-application-fraud-429065.aspx)
One thing that really stood out is that with the cost of living crisis which is most likely going to continue - 27% said they will consider lying on an insurance application to save money.
With insurers mostly having better controls around claims, having the ability to understand the customer is more than what is just being presented on the policy to understand application fraud. This is where the context of the network, bringing together external data and capabilities like device IDs are even more paramount in order to have that holistic view of risk.
Also having the ability to do this in real-time at low latency to minimise the number of customer touchpoints is becoming even more important.
Misrepresentation on an application or providing fraudulent documentation to obtain a reduced insurance rate or benefit may be the most undetected type of insurance fraud. Without a clear and full understanding of your customer's risk leaves insurers open to premium avoidance fraud.
Lying on an application or misrepresenting where your primary residence is located to obtain a low auto premium or misappropriating the number of workers or mis-identifying the class or risk of employees leads to millions in loss worker’s comp. premiums. With better connected data across underwriting and line of business, enriched with external data assets can provide better risk assessment and recuperating lost premiums.1
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