(Editor's Note: This article has been contributed by Stuart Rose, global insurance marketing manager at SAS.)
Insurance companies have implemented new claims management systems to improve the claims process, yet loss ratios continue to rise and fraud still occurs. To remain competitive, insurers need to consider applying predictive analytics across the claims life cycle. By looking at claims data in its entirety, insurers will be better positioned to optimize loss reserves, increase productivity, and root out fraud.
Despite a great deal of data, insurers still struggle. AM Best reported that in 2011, loss ratios for the top 50 auto insurers jumped to the highest level in at least 11 years. But simply increasing rates is a short-term fix in a highly competitive marketplace. Further complicating matters is the relentless pace of fraudsters. The National Insurance Crime Bureau (NICB) reported a 20-percent increase in questionable claims for the first half of 2012 compared to the same period in 2011.
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