Fraud is known to be one of the biggest cost drivers in the insurance industry. Despite various measures being put in place to tackle the problem – medical assessments, CCTV, dedicated fraud prevention analysts – fraud still adds around £50 to the annual insurance bill of every UK policyholder. Artificial Intelligence (AI) and automatic speech recognition (ASR) have the potential to instigate change.
In 2018, the average cost of insurance scams came in at £12,000 per claim. The typical annual cost in the UK is valued at around £1.3 billion. During the pandemic, it’s estimated that attempted fraud has increased significantly – if the numbers of fraudulent insurance claims processed in the global economic downturn are anything to go by, the upsurge could be as much as 21%. And most of the problem comes down to call centres.
Think of your average call centre. Dozens of operatives taking hundreds of calls daily. Their role is to get through as many calls as possible. Quickly. Efficiently. And on to the next. With a plausible demeanour, it doesn’t take much to phish your way past established defences, especially for previously unknown fraudsters. Call centres are the soft touch of the industry, open to social engineering in a way that websites simply aren’t.
That’s why the insurance industry suffers £4.6 billion to £10.4 billion of hard losses to undetected fraud every year.