According to Peter Cates, senior business solutions consultant within the financial practice at BAE Systems Applied Intelligence’s insurance team, insurers can achieve multiple benefits when using automated analytics for claims fraud detection.
• Detecting more fraud early on in the claims process can reduce claims leakage by eliminating payments on fraudulent claims earlier in the claim life cycle.
Cates believes the opportunity for financial benefit is “in the region of, for example, several percentage points’ reduction in overall claims spend.”
• By using an automated analytics system, insurers can maintain their existing headcount, using existing staff effectively while focusing on areas that are going to yield the most fraud detection.
• Increasing satisfaction among an insurer’s genuine customers.
“If you can make your decision quickly as an insurer whether this looks like fraud or not, and you can do it accurately, then you’re going to get the balance right between stopping fraud and keeping customer satisfaction for your genuine customers high,” Cates said.