power of ai and big data in insurance fraud detection

Are you worried about a Fraud Instance?

Insurance Digital transformation begins with the usage of customized data solutions to collect massive amounts of data in structured, semi-structured and unstructured formats during policy application, claims processing and client servicing. Unfortunately, there are many instances where this kind of huge data sources are rarely scrutinized while investigating fraud.
Big data management for Insurance business is a vital area because of the sensitive threats hidden in the form of transaction and claims fraud. Insurance businesses which look at growth opportunities through digital channels like web and mobile devices are increasingly deploying sophisticated fraud detection technologies to prevent fraud. On an average, 1 out of 10 insurance claims appears to be fraudulent. Many available fraud detection solutions are rule based and normal Data and analytics solutions may not always spot the discrete manipulations. Predictive analysis which uses rule combinations, data modeling, database searches, text mining and exception reporting helps in detecting fraud instances which happens at each stage of claims processing cycle. Enhance your existing fraud detection techniques with Cloud Big Data technologies to provide a competitive edge to your underwriting and claims processes; this in turn augments overall productivity of your operations.
When AI solutions is combined with traditional anomaly detection and other rules-based methods, fraud detection process gets more power. Give a new dimension to fraud detection techniques by identifying hidden patterns, integrating data, harnessing and reviewing unstructured data and deriving useful values to help with decision making process. Fraud Analytics allow insurance businesses to have a strong control over each transaction and do continuous testing to improve the scores.

Artificial Intelligence in Fraud Detection and Claims Management

Artificial Intelligence in Insurance is no more a new terminology for business enthusiasts; from digital smart assistants in the form of chatbots which revolutionize customer service and operations to the vast array of machine learning technologies, the capabilities are enormous. The initial hiccups around the conception of innovative AI enabled business methods and their implementation are now fading mainly because of knowledge and resources available in this regard. Following are the ways in which AI can contribute to Fraud detection:
  • Business data management : A crucial area where AI can help Insurance business; because of its huge data processing capability AI enables a strong workflow infrastructure where information flows freely within departments. Fraud instances are detected which might happen at any stage in this process.
  • Automated Claim Support: AI powered claims bot reviews the claim thoroughly and scans it using a fraud detection algorithm and sends instructions to the bank for claim settlement. All these are carried out with minimum human intervention and thereby errors in process are also minimized. Inaccurate claims are identified then and there using data pattern identification methodology and thus saves huge amounts by eliminating expensive fraudulent claims.
  • Personalization and verification: Insurance processes are often complex and confusing for a customer, this applies mainly to claims settlement and fraud instances are on the higher side in verification stage. Chatbots which are integrated to any digital channel provide human like interactions and makes verification easier with the help of NLP, sentiment analysis and voice identification which minimizes fraud instances.
  • Advanced and Secure Underwriting: AI has the capability to scrutinize the customer’s social profile data to draw inferences about their lifestyle, risk factors, financial stability and other relevant criteria. This in turn predicts risk factors and guards’ insurers from frauds. AI with its intelligent underwriting algorithms can easily identify fraud patterns and save time and cost involved in tedious underwriting process.

If you are looking for a secure and strong fraud detection AI model contact our AI Solution team today!

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Sophos MDR for next-level cybersecurity

15 May 2024 | 11AM EST

Aaron Gray
Sophos Channel Account Manager

Aaron is a channel expert passionate about Sophos’ industry-leading cybersecurity solutions. He collaborates with partners to deliver effective security strategies that safeguard businesses in today’s evolving threat landscape.