’There’s a dire need for us to keep raising awareness, because brokers are almost crying out for support [from insurers],’ says head of counter fraud
Insurer Allianz UK has noted a marked increase in fraudulent casualty claims in the first half of 2024 (H1 2024), with a noticeable uptick in those involving noise induced hearing loss.
The insurer has also noted a “large increase” in commercial application fraud in H1 2024, with a particular trend of fake or cloned businesses submitting fraudulent applications for insurance.
Speaking exclusively to Insurance Times, Allianz head of counter fraud James Burge explained that his team had prevented £37.7m of fraud in the period, with a 3.5% year-on-year increase in detection.
Much of this fraud saving was driven by casualty fraud, with Burge noting that Allianz were seeing an increase in the amount of noise induced hearing loss fraudulent claims.
A large proportion of this casualty saving was also driven by major loss fraud, he explained, although the non-major loss team at Allianz had also hit their targets.
Commercial focus
Alongside the contribution of casualty fraud, Burge said that Allianz was also seeing a “large increase” in fake or duplicated business claim fraud.
Read: Briefing – Commercial brokers are ‘very naïve’ about insurance fraud
Explore more fraud-related content here or discover other news stories here
As a result, Burge explained that Allianz were trying to “champion” the importance of detecting commercial fraud.
He said: ”Commercial fraud need to get more traction in the industry, because while we’ve talked about personal lines for a long time, commercial fraud needs to be front and centre as the future of the discussion.
“We’re seeing huge increases in fake businesses or duplicated or cloned businesses coming through the books, so we need to understand where we can tighten up our controls.”
Burge added that the solution to the growing threat of commercial fraud was multi-faceted, but would need the industry to come together to tackle it.
He added: ”We could continue to rely on the element of trust that is associated with commercial clients and brokers, but we’ve proved that doesn’t work anymore.
“There’s a dire need for us to keep raising awareness, because brokers are almost crying out for support [from insurers] and asking ’what do we need to do?’”
This is doubly necessary, Burge explained, because commercial claims – and commercial fraud – generally involves more complexity than in personal lines.
Advanced data enrichment and artificial intelligence (AI) are one aspect of the solution that Allianz are applying to this problem, he explained, with the hope that larger data sets “will help improve detection”.
He said: ”We’re on a bit of a journey with developing the technology that will help with detecting fraud that’s been missed in this space, because it can be very unique.
“Often with commercial fraud, there are individuals or an individual within a business committing fraud, rather than the whole business, so you also need to make sure you specifically understand and validate what you’re insuring – because you could be speaking to a duped business.”
No comments yet