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Insurance Fraud: Tackle, Before it’s too Late

Insurance Fraud has become a matter of grave concern in Europe. According to Insurance Europe, the European (re)insurance federation, the total from all cases of fraud – both detected and undetected – amounts to 10 percent of overall claims expenditure in Europe.

According to McKinsey, common pitfalls in Fraud Management are:

  • Not in the focus of top management
  • Limited importance of fraud in operational claims processing
  • Insufficient specialization
  • Hardly any modern investigation methods
  • IT systems that are obsolete or have not been maintained

Insurance companies need to act fast to realize this untapped potential from optimized fraud management as well as to reduce a potential competitive disadvantage compared to other insurers. This can be done in two stages:

  1. Putting fraud management on a more professional footing
  2. Rallying forces to fight organized fraud

The insurance industry, as a whole, needs to tackle these fraudsters for the interest of all market participants. To know more, read the following article by Thomas Kuhnt, Johannes-Tobias Lorenz, and Michael Müssig at mckinsey.com:

http://www.mckinsey.com/insights/financial_services/claims_management_taking_a_determined_stand_against_insurance_fraud

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Friday, 06 June 2025