Strength in numbers
Mondial Assistance UK is calling for fellow travel insurers to get behind a number of industry initiatives to tackle fraud. Mandy Aitchison reports “There’s no question that the travel insurance sector is facing tough times,” says Mike Webb, chief executive officer of Mondial Assistance in the UK. “There is no need to list the catalogue of events that have made 2010 a year not to be remembered! However, the industry has the ability to deal with its two largest problems – low premium income and fraud, but still fails to tackle these issues.” Mondial Assistance has been working with four other insurers in order to create a shared database for all claims, which creates a risk score, allowing the companies to improve their fraud detection rates. It has also helped the firms to prevent multiple fictitious claims, made to a number of insurers, even if the policyholder has used different names in their attempt to defraud. Other moves by Mondial that could easily be adopted by other travel insures is expert training of call handlers, according to Webb: “Training has been given to the Mondial travel claims teams to help them identify the behavioural ‘shows’ that could suggest fraud. There is also a system of ‘red-flagging’ customer responses to key questions asked as part of the claims process.” If a claimant makes three ‘red flag’ comments, the case is passed on to a fraud manager for further investigation. According to Webb, although the company does see some attempts at fraudulent medical and cancellation claims, ‘the major area of concern is personal possessions and baggage’. “In some cases,” he continued, “the whole claim is false and the growth of websites that sell fake receipts is further adding to the problem. We estimate that up to 50 per cent of all claims for baggage and personal possessions may be inflated, or completely false.” Webb went on to ask: “As this is such a costly problem for all travel insurers, why is there such a lack of focus on this? It is enormously disappointing that even after many years of discussion, the travel insurance industry still haven’t joined forces to create a generic system to prevent fraud. It is a relatively simple problem to resolve and it’s worked in other sectors of the insurance industry such as the Claims Underwriting Exchange.”
Mondial Assistance UK is calling for fellow travel insurers to get behind a number of industry initiatives to tackle fraud. Mandy Aitchison reports
“There’s no question that the travel insurance sector is facing tough times,” says Mike Webb, chief executive officer of Mondial Assistance in the UK. “There is no need to list the catalogue of events that have made 2010 a year not to be remembered! However, the industry has the ability to deal with its two largest problems – low premium income and fraud, but still fails to tackle these issues.” Mondial Assistance has been working with four other insurers in order to create a shared database for all claims, which creates a risk score, allowing the companies to improve their fraud detection rates. It has also helped the firms to prevent multiple fictitious claims, made to a number of insurers, even if the policyholder has used different names in their attempt to defraud.
Other moves by Mondial that could easily be adopted by other travel insures is expert training of call handlers, according to Webb: “Training has been given to the Mondial travel claims teams to help them identify the behavioural ‘shows’ that could suggest fraud. There is also a system of ‘red-flagging’ customer responses to key questions asked as part of the claims process.” If a claimant makes three ‘red flag’ comments, the case is passed on to a fraud manager for further investigation. According to Webb, although the company does see some attempts at fraudulent medical and cancellation claims, ‘the major area of concern is personal possessions and baggage’. “In some cases,” he continued, “the whole claim is false and the growth of websites that sell fake receipts is further adding to the problem. We estimate that up to 50 per cent of all claims for baggage and personal possessions may be inflated, or completely false.”
Webb went on to ask: “As this is such a costly problem for all travel insurers, why is there such a lack of focus on this? It is enormously disappointing that even after many years of discussion, the travel insurance industry still haven’t joined forces to create a generic system to prevent fraud. It is a relatively simple problem to resolve and it’s worked in other sectors of the insurance industry such as the Claims Underwriting Exchange.”