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.

Also galvanizing scammers is the unfortunate public misperception of insurance fraud as a “victimless crime.” Thus, for insurers, the best defense is defining and meticulously executing specific fraud-detection programs, which encompass the right people, processes, and technology that marry quality claims and underwriting data.