Diversity of fraud is ‘biggest challenge’ for UKGI market – IFB

Not-for-profit organisation the Insurance Fraud Bureau (IFB) is urging the UK general insurance (UKGI) sector to look beyond just motor insurance when it comes to tackling fraud.

Although the body was initially established in 2006 to fight insurance fraud predominantly found in the motor market – such as crash for cash schemes – recent industry appetite seeks to apply this anti-fraud focus to other business lines, according to Ursula Jallow, director of the IFB.

She told Insurance Times that the “biggest challenge” in the UKGI sector right now is “to ensure the market is collectively tackling a diverse range of products” when it comes to implementing anti-fraud measures.

She explained: “Previously, the market had mainly focused on motor fraud and now there’s an appetite to ensure other product lines are also being tackled in a similar way.

“There is definitely an appetite from the market to explore more areas and to improve.

“It’s critical that we continue to find new ways to detect fraud across all product lines. Having a more coordinated approach across the board, such as we have with motor, will enhance the industry’s fraud defences.”

Joined up approach

For Jallow, collaboration in the UKGI ecosystem will be vital in delivering effective anti-fraud measures across more insurance classes.

She continued: “We know that opportunistic fraud is on the rise and this won’t just be in the motor fraud space. By being more coordinated across all product lines, the industry is best placed to tackle the diversity of fraud we are facing.

“For instance, [the] IFB is leading a new Commercial Intelligence Fraud Group that will support initiatives to bring the market together on wider aspects of fraud prevention in the commercial space.

“Consumers rightly expect [the] IFB and the industry to have a robust approach to tackling fraud.

“We’re encouraging the industry to have a more coordinated approach across other product lines, including commercial insurance, as it enhances the industry’s fraud defences.”

The Commercial Intelligence Fraud Group launched in 2023.

The year ahead

Jallow’s warning around the diversity of fraud follows the publication of the IFB’s first business plan on 29 January 2024.

The 13-page document provides an update on the IFB’s three-year Forward Together strategy, which first launched in 2023.

The strategy focuses on three key pillars: broadening the IFB’s affiliate and membership model, decommissioning its legacy technology and raising consumer awareness of insurance fraud and common fraud techniques through campaigning.

“The most important prevention mechanism is education and awareness, so it’s important for the industry – including brokers – to ensure they’re educating customers and potential customers to understand what insurance fraud is, the impact of it and how [consumers] can avoid becoming a victim,” Jallow added.

With this third and final pillar in mind, the IFB plans to ramp up its campaigning efforts this year.

Its work in 2024 will include developing a digital marketing strategy, creating a resource hub for member firms to utilise when undertaking their own campaigns, establishing a new member newsletter and reviewing the IFB website.

The organisation will also host more briefings and collaboration opportunities through its Communications Working Group, which formed in 2023.

Part of the General Insurance Fraud Committee (GIFC), the working group features communications professionals from member firms such as the ABI and Insurance Fraud Enforcement Department (Ifed).

Foundations for ‘meaningful change’

In terms of updating its technology, the IFB wants to offer more self-serve capabilities – including computer-based training and management information reporting.

It will additionally look to make its internal processes more efficient, re-platform its digital intelligence database – called IFIHUB – and enhance its artificial intelligence (AI) fraud detection tool, IFB Exploration, which launched in 2022.

“Over the past year, we’ve been reviewing our processes, responding to members’ needs and simplifying user experiences,” Jallow noted.

“These changes have not just been about making immediate improvements for members, but laying down the foundations to implement meaningful change and ensure we can service other product lines.

“A good example of technology we’ve introduced includes IFB Exploration, an AI-based counter-fraud [tool] we introduced over a year ago.

“Since implementation, we have seen industry searches for fraud rise eight-fold compared to the previous [proposition], with over 40 fraud network alerts being generated each week.”

Membership diversity

As for broadening its membership and affiliate model, the IFB will be evaluating its member engagement approach this year, as well as updating documentation around membership rules and agreements.

It also plans to create a products and services framework and explore potential changes to its existing levy structure.

Jallow added: “We are undertaking a key piece of work in 2024 to ensure the framework for [the] IFB in the future is more diverse, allowing for a broad range of insurers in our membership, such as life insurers.”