Q: How serious is the fraud in the Insurance sector?
Response:
Insurance companies have been impacted by fraudulent activities, suffering financial losses as a result. Most industry experts believe that fraud exists anywhere between 10-15% and they are being discovered across lines of business.
The Insurance Regulatory and Development Authority of India (IRDAI)sets out 3 broad categories of fraud - Policyholder Fraud and/or Claims Fraud, Intermediary Fraud and Internal Fraud.
It has been observed that in motor claims; motor OD/theft/ personal accident/ third party frauds occur on account of misrepresentation of facts, fabrication of documents and or implantation of driver or vehicle to get undue gain from Insurance Company.
In property claims we observe misrepresentation of quantity and quality of material lost or destroyed. Arson is represented as fire loss.
In health indemnity, we observe frauds on account of fake/ fabricated treatment records, fabrication of bills/ medical documents, misrepresentation of facts like increase in length of stay, outdoor patient treatment converted to indoor patient department, formation of fake Small & Medium Enterprises (SME) entities for the purpose of Insurance claims etc.
In Personal accident claims we observe frauds on account of forged and or fabricated Police records, medical records for cause of death including post-mortem reports, forged treatment records for disability and on account of misrepresentation of facts around the cause of death to get benefit of Insurance.
We also observe fraud on account of dishonesty of employees or intermediary in form of premium siphoning or fake/ forged reimbursement claims, claims fraud, issuance of fake policy by external entities.
Q: What step companies are taking to stop this?
This story is from the July 2023 edition of THE INSURANCE TIMES.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the July 2023 edition of THE INSURANCE TIMES.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
International News
Saudi Arabia's Insurance Market Poised for Transformation - Saudi Arabia's general insurance market is on a trajectory of rapid growth, with gross written premiums expected to rise from SAR 68.8 billion ($18.4 billion) in 2024 to SAR 105.3 billion ($28.1 billion) by 2029, reflecting a CAGR of 8.9%. This growth is driven by regulatory reforms, economic diversification, and increased consumer awareness of risk management.
Life Insurance News
HDFC Life Insurance Reports Data Breach - HDFC Life Insurance recently disclosed a data breach, adding to the growing list of Indian insurers facing cybersecurity threats. The breach, revealed in a regulatory filing, prompted the company to launch an extensive investigation with information security experts to safeguard customer interests.
Health Insurance News
Star Health Launches 'Star Arogya Digi Seva' to Enhance Rural Healthcare - In a bid to revolutionize rural healthcare, Star Health Insurance unveiled its latest Corporate Social Responsibility (CSR) initiative, 'Star Arogya Digi Seva,' in collaboration with the Center for Chronic Disease and Control (CCDC). The initiative aims to provide essential healthcare services to underserved rural areas by leveraging telemedicine technology and Mobile Health Units (MHUS).
Insurance Regulator Update
IRDAI Calls for More Players in the Insurance Sector - IRDAI Chairman Debasish Panda has called for more conglomerates to enter the insurance space, emphasizing the immense opportunities offered by India's vast population of 1.4 billion. Panda urged private equity funds, institutional investors, venture capitalists, and family offices to explore the insurance market, highlighting that the current 70 insurers in the country are insufficient to meet growing demands.
General Insurance News
Tier 2 and 3 Cities Propel Growth in Motor Insurance - The rise in private consumption in India has positioned tier 2 and 3 cities as key drivers of growth in the motor insurance segment. Increasing vehicle ownership and heightened awareness of insurance have fueled this expansion, according to a report by InsurTech platform Turtlemint. These cities accounted for over 90% of motor insurance policies sold and the premium volume during the festive season this year.
"Bancassurance is at the heart of our growth strategy. It allows Bandhan Life to reach more customers and provide accessible, trusted insurance solutions through a familiar network."
About Indranil Dutta - Indranil Dutta brings 23 years of experience in insurance, banking, and sales, with a specialization in bancassurance. As the Chief Business Officer - Bancassurance at Bandhan Life Insurance, he leads the banca sales channel and plays a key role in driving the company's strategic vision of becoming a leading multi-channel life insurer with an expanded presence across product categories.
IRDAI Corner
The Eighth Bima Manthan, the quarterly meeting of IRDAI with the insurance industry was held on 11th and 12th November 2024, in Hyderabad
International Conference on Inclusive Insurance (ICII) 2024
The 20th edition of the International Conference on Inclusive Insurance (ICII) concluded on a high note in Kathmandu, Nepal, after five days of insightful discussions, interactive workshops, and collaborative networking. Hosted by the Nepal Insurers' Association in partnership with the Life Insurance Association Nepal, Nepal Micro Insurance Association, Nepal Insurance Authority, Munich Re Foundation, and the Microinsurance Network, the conference brought together around 500 participants from around the globe. The Insurance Times was the media partner in the event.
How to choose a Health Insurance Plan that fits your evolving needs
When you are single, you might focus on plans with basic coverage and low premiums. As you get married, look for family floater plans that cover your spouse. When you have children, ensure the plan covers pediatric care, vaccinations, and other child-specific healthcare needs.
My View on #20SIRC Conference
The participants include world top reinsurers, brokers, insurers, IT companies, Consultants, and Regulators. As a regulator from Nepal attending the (#20SIRC) was a unique thrilling experience that provided opportunities for learning, networking, and strategic development. Here's a detailed perspective that I had experienced during my visit to Singapore.
