In simple terms, insurance fraud is an unlawful act on the part of either the seller or buyer of an insurance contract. It involves an intentional deception committed against or by an insurance company or agents for the sole purpose of financial gain.
From the seller’s part, insurance fraud could include selling policies from defunct or non-existent companies, forfeiting the submission of premiums, and churning policies to create more commissions.
Buyer fraud, on the contrary, can include inflated claims, fabricated medical history, post-dated policies, misrepresenting facts on an insurance application, viatical fraud, feigned death or kidnapping, and murder. Hence, you should have the ability to find public record information of both agent and claimant.
Key Features of Insurance Fraud
Basically, the key features to know about insurance fraud include;
- It involves any deliberate wrong use of insurance policies or applications to gain or benefit illegally.
- Professionals who inflate service costs or charge for services not rendered, and
- Ordinary people who want to cover their deductible or view filing a claim as an opportunity to make a little money.
You should understand that fraud can occur at any point during an insurance transaction, from applicants to policyholders, third-party claimants, or professionals who provide services to claimants.
More so, now that cybercrimes and different fraudulent activities are at an all-time high, it’s ideal that you are careful and vigilant with your business and day-to-day activities, both online and offline, so you don’t fall victim.
As such, there are quite a handful of ways to guarantee your safety. Lie detection, amongst many others, is a proven way of preventing being a victim of any form of fraud, better put, detecting deception.
Ordinarily, being able to decipher if someone is telling a lie goes a long way in avoiding many criminal acts and also arresting the perpetrators of such criminal activity. Hence, here is what you should know about lie detection and its relevance to insurance fraud.
Lie detectors are instruments that monitor and record physiological changes observed when a person answers test questions. The data show that if a person reacts more strongly to specific types of questions, they can be classified as deceptive or credible with a high degree of accuracy.
Many technologies are employed in lie detection, and the most common is the polygraph. The most recent, innovative solution with comparable accuracy to polygraph is EyeDetect®. While both tests are not without errors, to a very large extent, they are very accurate. All other lie detectors that have been invented are either less accurate or too costly to implement.
Benefits Of Lie Detection In The Insurance Industry
With the high level of frauds, whistle-blowers, phishing, corporate or product sabotage, and lots more, lie detection has become an important aspect of any organization, especially in the insurance world. Below are a few benefits of lie detection in the insurance industry.
- It provides a more amicable way of settling disputes and detecting fraud.
- It helps to verify the credibility of an insurance client during a dispute or disagreement. In fact, a polygraph examination would be the best way to settle these types of conflicts between both parties.
There is no end to the benefit of lie detection in our society today. And in the insurance industry, where there are higher chances of fraudulent activities, the importance of lie detection can not be overemphasized.
About the author: Ben is a Web Operations Executive at Info Tracer
who takes a wide view from the whole system. He authors guides on entire security posture, both physical and cyber. Enjoys sharing the best practices and does it the right way!
Photo by / Gerd Altmann