Singapore’s Insurance Fraud Detection Techniques on High Alert

Insurance fraud cases in Singapore have more than tripled from 20 in 2018 to 71 in 2021, prompting the General Insurance Association of Singapore (GIA) to take drastic measures to combat this growing issue.

The Growing Problem of Insurance Fraud

According to Andrew Yeo, CEO of Income and GIA Management Committee Member and Insurance Fraud Committee Convenor, insurance fraud cases have increased significantly, with motor insurance fraud being a major concern. This rise in fraudulent activities has significant consequences for the industry and consumers alike.

The Impact of Insurance Fraud

As emphasized by Andrew Yeo, “Contrary to what may be a widespread belief, insurance fraud is not a victimless crime. It can result in significant costs for the industry, including the cost of payout claims, and manpower costs in terms of time and resources used to investigate fraud. This will ultimately impact consumers as this will drive the cost and affordability of premiums.”

The GIA’s Fraud Management System (FMS)

The GIA’s FMS, launched in 2017, uses data analytics and artificial intelligence to detect potentially fraudulent claims at scale. The system has been instrumental in uncovering numerous instances of fraud, including a recent case where a Singaporean woman was sentenced to five months in prison for making 20 fraudulent travel insurance claims worth over S$14,000.

How the FMS Works

The FMS works by analyzing suspicious claims and flagging them for further investigation. Insurers are then contacted to verify the claims, and if sufficient evidence reveals that there is fraud, a police report is filed and the insurers involved cooperate with the authorities.

In addition to the FMS, the GIA also collaborates with specialist investigators from the Commercial Affairs Department and insurance representatives through the Insurance Fraud Committee (IFC). The agency shares information and best practices in detecting and preventing insurance fraud with the Singapore Police Force’s specialized fraud investigation branch.

Reporting Suspected Insurance Fraud

The GIA is also working to raise awareness among the public about the importance of reporting suspected insurance fraud. Under the GIA Insurance Fraud Tip-off (GIFT) program, individuals who report fraudulent activities can receive a reward of up to S$10,000 if their tips lead to successful prosecution and conviction.

Industry Collaboration and Best Practices

Insurers play a crucial role in detecting and preventing insurance fraud, providing claims insights that help refine the FMS system. The GIA is also working to impose high standards of conduct among insurers and their employees, publishing industry whitepapers on best practices guidelines for anti-fraud measures.

Conclusion

Insurance fraud is a growing concern in Singapore, with significant consequences for the industry and consumers alike. The General Insurance Association of Singapore (GIA) has taken drastic measures to combat this issue, including the development of the Fraud Management System (FMS), collaboration with specialist investigators, and awareness campaigns among the public. By working together, we can prevent insurance fraud and ensure a more secure and fair insurance landscape for all.