Behavioral biometrics enhance digital security for insurers

The COVID-19 pandemic has dramatically expedited the adoption of digital technologies for insurers and their customers. Business processes that were once done in person to ensure security and integrity are moving to mobile apps and digital devices. So how do insurers verify that digital customers are who they say they are to help protect their information? Passwords, multi-factor authentication and facial recognition are a good start. And most insurers have deployed identity access management (IAM) solutions to improve the customer experience, minimize risk and ensure compliance with evolving privacy regulations.

Unfortunately, insurance thieves can be smart, and they may act quick. They can easily access real accounts or create a new one by using stolen data. Once in, they may be able to submit false claims and receive fraudulent payments for weeks before they are detected.

But, there is an emerging, fast-growing technology that can give carriers another alternative for keeping the bad actors out and customers engaged. Behavioral biometrics looks at interactive gestures, such as how a person types on a keyboard, moves a mouse, holds a phone or taps a touch screen and compares those behaviors with known digital traits common to fraudsters, bots and trusted users. The technology is able to help detect and block automated attacks and suspicious transactions based on the user’s behavior, which adds a layer of security while minimizing interference with a real customer’s digital experience.

Behavioral biometrics also helps confirm the integrity of the customer by verifying and identifying their behaviors. According to a report by Grand View Research, the global behavioral biometrics market size is expected to reach $4.62 billion by 2027. The driver for the growth, according to Grand View, is the increase in cyberattacks and the ongoing demand to protect customer data while delivering a streamlined user experience.

Security is the foundation for digital business

Secure digital platforms are especially critical to help prevent identity theft for insurers, given the staggering amount of information they have on each of their policyholders. In 2019, 650,572 consumers filed identity theft reports, according to the Federal Trade Commission Consumer Sentinel Network Data Book. This amounted to $1.9 billion in total fraud losses, an increase of more than $293 million from the previous year. The insurance industry suffers greatly from consumer fraud. According to the FBI, annual losses related to insurance fraud (non-health) are approximately $40 billion, costing the average American family $400-$700 in increased premiums each year.

With the shift in business models driven by the pandemic, digital business and cybersecurity are on the minds of CEOs. In its 24th Annual Global CEO Survey*, PwC noted that the pandemic served a dual role as an accelerator of transformation and amplifier of disruptive forces. Nearly half of the 5,000 CEOs surveyed are planning to increase their digital investment “significantly” (10% or more) during the next three years because of COVID 19 — doubling down on gains made during the pandemic.

Unfortunately, one of the most disruptive forces is cybersecurity threats. Concern about cyber threats is on the rise, cited by 47% of CEOs, up from 35% last year. That made it the number two concern of global CEOs (after the pandemic), and the number one concern of CEOs in North America and Europe.

Behavioral biometrics is good for all, except for the bad actors

Behavioral biometrics can help weed out the bad actors enabling carriers to provide their best service to “real” customers and prospects. Incorporating layers of defense, such as profiling account behavior, measuring biometrics, accessing shared intelligence about known fraud, as well as detecting malware and remote access control helps provide enhanced security without disrupting the customer experience.

Customers want to be safe while doing business online. And they want their experience to be frictionless — moving quickly yet safely through the process. Insurers can deliver customers a safer, easy-to-use journey by developing workflows that help identify and assess risk behind the scenes based on behavioral biometrics. If the customer’s behavior comes back as high-risk, the workflow can introduce friction, making it difficult to close the transaction. Low-risk customers can move forward with their digital transactions in a very low-touch experience.

Seamlessly up your security game

Digital businesses are booming, but looming cybercriminals are not going away. It’s time for insurers to consider boosting their traditional security measures by deploying behavioral biometrics. Behavioral biometrics can help enhance the security solutions already being used by insurers by providing authentication that is frictionless and less invasive while using existing technology to better leverage their investments.

* Reprinted with permission from ”PwC’s 24th Annual Global CEO Survey: A leadership agenda to take on tomorrow“© 2021 PwC. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

Kim Brown is director of product management for the LexisNexis Risk Solutions’ Identity Access Management suite of products. Kim has been with LexisNexis Risk Solutions since 2015 and leads a team responsible for defining the use cases, value props and strategy for the identity products focused on identity verification, authentication and risk assessment.

Previously, Kim held analyst roles at a top P&C carrier focused on customer acquisition and the online customer experience. Kim earned her bachelor’s degree in math and statistics from Morgan State University, has a master’s in financial mathematics from Purdue University and earned her master’s in business administration from Emory University’s Goizueta Business School.

Opinions expressed here are the author’s own.

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