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Building Better Mousetraps

Fraud may cost the P&C insurance industry $80 billion annually by 2015. To disarm increasingly ambitious fraudsters, insurers must harness the sophisticated tech tools at their fingertips.

By Christina Bramlet | Updated on August 26, 2013
Finally, a new number to bounce around the p&c insurance industry lexicon: $80 billion. Gulp. That’s quite a number, isn’t it?

For years, we have been estimating that insurance fraud siphons about $30 billion from insurers’ pockets, and arguably much more from the public at large. I must confess to having grown tired, and rather skeptical, of this figure, even in spite of the disclaimers about its opacity.

But having a shiny new projection is the opposite of refreshing; it’s alarming. That’s because, according to Aite Group, we’ll be contending with about $80 billion in fraud “taxes” by 2015. As for 2012, Aite estimates this rampant crime cost p&c insurers about $64 billion.

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