A recent seminar has revealed an increasing amount of identity theft is contributing to fraudulent claims which cost the life assurance industry over R200-million in the first nine months of 2003 alone.

These statistics were revealed at a recent seminar entitled “Forensics, Fraud and Finance sponsored by RGA Reinsurance Company of South Africa .

RGA managing director Desmond Smith says his company is anxious to bring more focus and heighten awareness on the problem of insurance fraud.

Scorpions see identity theft as serious issue
The Scorpions division of SAPS has recognised identity theft as having become a very serious issue. For example, in Kwa-Zulu Natal in 2002, they estimated that 75 percent of requests for ID re-registrations were as a result of ID theft by syndicates planning to make use of these documents in fraudulent insurance claims. It can be as simple as stealing the identity documents of another person in order to take out a policy or lodge a claim, or as complex as falsely identifying bodies at government mortuaries.

“There is a whole chain of involvement in these scams. In some cases people even acquire an unclaimed body to ‘prove' that a death had taken place,” explains Mr Smith. “As custodians of our policyholders' savings, it's incumbent upon us to identify and eradicate fraud. White-collar crime is endemic in our society as many people see insurance companies as ‘fair game.'

Better understanding of issues
“Having a platform such as our seminar held last month to learn things like the latest forensic techniques and how to spot a fake ID from top experts in the field will help prevent fraud. It gives people better understanding of what the issues are and vitally, contact with specialist knowledge that is on tap outside the industry.”

Smith adds that there is often fear or ignorance about the external knowledge and support available to insurance companies. “Too often we in the industry don't share information simply because we don't talk to each other enough. There are various means of determining if documentation is false and provided one has been taught how to do this, it may be relatively easy to spot suspicious claims.”

False claims increase insurance costs
He points out that false claims increase the cost of insurance. So combating fraud will obviously benefit policyholders. On the other hand, he notes that it is distressing for beneficiaries to face delays in payments because of a suspect claim.

Courtesy www.insurances-times.net

Print this page
Send this article to a friend
RSS
de.li.cious
facebook