Increased fraud loss threatens to dilute the benefits digitally transacting customers could bring to carriers.
Boston, September 21, 2021 — The recent mass adoption of digital platforms and processes, driven by the pandemic, is a double-edged sword for insurers. It helps improve customer experience, increases speed of policy issuance or service, and reduces cost. But it also expands the means and opportunities for fraudsters to steal identities and commit financial fraud. As a result, insurers need to make sure that their fraud mitigation and identity verification capabilities appropriately guard against fraudulent activities.
“Carriers could benefit by identifying and adopting multiple solutions, or by taking a multilayered approach, for a stronger defense,” says Aite-Novarica Group Strategic Advisor Manoj Upreti. “This requires merging data from multiple sources, combining fraud solutions to validate identity verification and authentication, and escalating the security controls based on the level of internal and external information available about the user,” he continues.
The report measures increases in digital activity and corresponding rising fraud incidents during the first year of the pandemic and analyzes the impact of those trends on the insurers. It also looks at fraud solutions and their adoption as well as the benefits of a multilayered approach to fraud management. It is based on a May 2021 online quantitative survey, commissioned by LexisNexis Risk Solutions and conducted by Aite Group, of 132 subject-matter experts and decision-makers of fraud prevention strategies at U.S. insurance carriers with at least US$500 million in 2020 premium revenue.
To request a press copy of this report or to speak with Manoj Upreti, Michael Trilli, and Stuart Rose about this topic, please contact us at [email protected].
About Aite-Novarica Group:
Aite-Novarica Group is an advisory firm providing mission-critical insights on technology, regulations, strategy, and operations to hundreds of banks, insurers, payments providers, and investment firms—as well as the technology and service providers that support them. Comprising former senior technology, strategy, and operations executives as well as experienced researchers and consultants, our experts provide actionable advice to our client base, leveraging deep insights developed via our extensive network of clients and other industry contacts. Visit us on the web and connect with us on Twitter and LinkedIn.
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