Insurance fraud and claims leakage are a concerning issue for all insurers globally including those in the Middle East, according to a recent survey.

PricewaterhouseCoopers’s (PWC) 2014 Middle East Economic Crime Survey revealed that only five per cent of frauds were detected by internal audit, with 22 per cent detected by tip-offs and 16 per cent now detected by chance, indicating a widespread lack of effective fraud detection methods in the region.

To provide fraud analytics more quickly and affordably, SAS is now offering SAS Fraud Framework for Insurance via the cloud to insurance companies in the Middle East, said a statement.

The new option not only increases investigator efficiency and lowers cost of ownership, but does it securely on the SAS Cloud as a software-as-a-service (SaaS) offering, it said.

Ebru Jouzy, fraud and anti-money laundering (AML) expert, Middle East and Turkey at SAS, said: “With over 50 years’ of experience in the insurance fraud sector, we at SAS helped develop fraud solutions for a number of organisations ranging from motor, home, health insurance including workers’ compensation.

“The exact rates of claims fraud, waste and abuse are difficult to determine but recent figures from regional industry and regulatory bodies suggests that ‘figures allude to the notion that as much as 10% of claims are fraudulent and as little as 20 per cent of these are detected’, and global figures range from five to 15 per cent.”

SAS Fraud Framework for Insurance will help to accurately detect potentially fraudulent activity with the solution being flexible if any new rules need to be added as new fraud types evolve. The pre-built fraud analytical models have enabled companies to implement the solution in weeks instead of months.

Powered by SAS’ advanced fraud analytics engine, SAS Fraud Framework for Insurance uses multiple analytics techniques: business rules, anomaly detection, predictive modelling, database searches and link analysis.

The solution will enable insurers to uncover more suspicious activity than traditional manual methods of detection.

“Combating claims fraud is difficult and costly for insurers but not for organised crime rings, which find insurance fraud to be a low-risk, high-return enterprise. With this in mind, it is important for insurance companies to have a defense mechanism that helps them to manage, detect and predict potentially suspicious claims before further losses are incurred,” Jouzy added. - TradeArabia News Service