Insurance Fraud, Identification of Fraudulent Cases and Possibilities for Reducing This Phenomenon
Insurance Fraud, Identification of Fraudulent Cases and Possibilities for Reducing This Phenomenon

Author(s): Klaudia Lipi
Subject(s): Social Sciences
Published by: Udruženje ekonomista i menadžera Balkana
Summary/Abstract: Insurance fraud is when someone gives false, incomplete, or concealed information, to an insurance company with the intention of making a profit. This may include creating illegal insurance policies or making false claims against an existing policy. The types, scale and consequences of fraudulent practices in the insurance industry are the purposes why this phenomenon is chosen to be treated and analyzed in this paper. Trying to find and suggest ways to reduce it after studying fraudulent practices in specific insurance products. Different studies around the world show that more than half of insurers believe that fraud is the most important threat in the insurance industry. All insurance companies and all classes of business and customers are affected by fraud, in terms of costs incurred. For the insurers, the fraud can damage also their image and reputation. Consequently, the effort invested in countering this scourge has become essential for both insurers and customers. The insurance companies are planning to use more resources to prevent and reduce insurance fraud, by designing and implementing insurance fraud reduction policies. Nowadays, they use Strategies and Technologies such as Artificial Intelligence and Machine Learning to detect and prevent fraud in the insurance industry.

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