Search
 

Facing Fraud Together

We must admit that silos between underwriting and claims exist and need to be eliminated so that fraudsters do not sliver their way into lower-than-adequate premium calculations or inappropriate claims payouts.

By Christina Bramlet | Updated on August 29, 2011

The disconnect between underwriting and claims is oft lamented. The undercurrent of animosity that exists between the two—which some construe as conflicting fiefdoms; or simply conflicting priorities—is a multi-faceted problem that we have no delusions of adequately exploring in this one article. Suffice it to say, aside from exacerbating bruised egos and awkward encounters at the company picnic, lack of collaboration between the two takes a significant toll on insurers’ ability to effectively assign and manage risks, assess adequate premium, and control claims costs.

Compounding the issues associated with this communication breakdown is a vague air of depersonalization that has seeped into virtually every nook and cranny of the industry. For the sake of expediency and process cost reduction, in both claims processing and managing policies, there has been a proliferation of self-service options. Within the capabilities of modern technologies, consumers may now seek coverage and claimants can report loss incidents often with virtually nil human interaction. Consequently, insurers are losing contact with their policyholders, as neither may be able to associate a “face” or “personality” to the other. Behind the guise of anonymity (or impunity) afforded by the Internet, including “how to scam insurers” tutorials, consumers are able to execute what may end up being a deceiving self-service policy and claim reporting options. This subset of carrier customers make it their business to know as much as they can about automated rating and claim handling practices so as to intentionally misrepresent their circumstances to obtain lower auto and homeowners’ policy premiums, thereby setting the stage for higher claim payouts completely unrelated to the risk they realistically represent.

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.

INCLUDED IN A DIGITAL MEMBERSHIP:

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

PropertyCasualty360

Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join PropertyCasualty360.com now!

  • Unlimited access to PropertyCasualty360.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including BenefitsPRO.com, ThinkAdvisor.com and Law.com
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2024 ALM Global, LLC. All Rights Reserved.