The head of commercial development at damage management firm ServiceMaster Clean said that desktop auditing by counter fraud technicians would not be enough to combat the problem, with the Association of British Insurers estimating that undetected fraud stands at £1.9bn a year.
A pilot of the firm’s fraud detection service found that insurers on the scheme doubled the number of claims they turned down and had helped save the companies “hundreds of thousands of pounds” in claims they would have otherwise paid, Mr Holmes said.
He added: “It is now critical that face-to-face validation also takes place, undertaken by experts trained to detect fraud.
“Thorough validation helps to reduce the amount of settled uninsured losses and fraudulent claims, as well as resulting in more rapid claim repudiation and a quicker turnaround time for legitimate claims.”
The firm has now published a two-page guide explaining the benefits of this more comprehensive approach, which it says can help flag up warning signs, such as changes to the policyholder’s account of events and similar claims made by the same policyholder in the past.
ABI view
Stephen Sobey, senior media relations officer at the Association of British Insurers, said: “Insurance fraud remains an ongoing, burgeoning problem. Fighting insurance fraud remains a key strategic industry priority and collectively the industry invests around £200m a year in preventing, detecting and enforcement against fraud.
“The Insurance Fraud Enforcement Department and the Insurance Fraud Register send strong signals of the industry’s ambition to reduce fraud and complement the ongoing work of the Insurance Fraud Bureau, which has spearheaded the fight against organised insurance fraud since 2006.”
