Artificial Intelligence has achieved unprecedented success over the years and several products and services have been introduced that enable common users to perform their daily life activities with relative ease. But the true potential of AI will be fully achieved when large businesses and corporations will be able to perform complex computations and complicated tasks with even much more ease because of smart systems and solutions.
The insurance industry is also one business category that has a serious workload because of the sophisticated nature of its operations. There are several loopholes in the insurance claim process that is exploited by scammers and the percentage of such scams have only gone up despite the insurance industry hiring a large contingent of manual compliance officers. Even the automated systems used to handle large inventory on behalf of the insurance industry, are limited in their approach in detecting any attempt of insurance or claims related fraud. So like any other industry, managing financial risk is important for the insurance industry as well and here is how AI can help this industry in mitigating financial risk.
Most Common Form of Insurance Fraud
The most exploited facet of insurance fraud originates from fake insurance claims. Most scammers and fraudsters commit this kind of fraud because in most cases it is nearly impossible to check the claim through an independent source. Some scammers use synthetic IDs in order to adopt fake identities and then file fake claims based on those identities. Doctored identity documents are used with readily available personal data from multiple sources. Most of the times, the personal information used to concoct a new identity does not even belong to a single person. Thus making it virtually impossible for identity theft solutions to detect anything shady about the user with a fake identity.
Another half of the crowd that commits insurance frauds uses fake medical documents to claim eligibility for monetary assistance through medical insurance. Such fake claimants use false medical records or entirely fabricated information of hospitals and doctors to claim their insurance money.
What Can Artificial Intelligence do?
Insurance based frauds can be effectively reduced with the help of Artificial Intelligence. Customer Due Diligence is the most appropriate method to deter any attempt at scamming an insurance company. It can be performed for each insurance claim by first of all checking all the personal information provided by a claimant and then verifying it with the help of an authentic identity document. Artificial Intelligence supported by liveness detection, template matching, and machine learning algorithms can easily check for any tampered information, photoshopped element and any other attempt to provide falsified information on an identity document.
Additionally, background checks can be performed by scanning the public records in nearly real-time for the medical or personal information provided by a user to claim an insurance policy. Complete identity profile can be vetted by the customer due diligence protocols to ensure that financial scammers and fraudsters are never able to defraud insurance agencies again.
An otherwise, complicated and manually driven task of risk detection can easily be tackled by Artificial Intelligence with different data points being simultaneously assessed not only for quicker processing time but to also ensure a comprehensive check for insurance claim authentication.