Muzaffer AKTAS: Motor insurance is like sailing in dangerous waters

Fraud creates a problem in motor insurance because of the high number of active policies, making it a very dangerous line of business. “Fraud is one of the most dangerous things in insurance as well as one of the most difficult issues to deal with. Every person, including employees, from top to bottom can get involved”, said Muzaffer AKTAS, Managing Director of WILLIS Re UK.

“Every single company starts with motor insurance and tries to part with it when trouble occurs. It helps you to penetrate the market, which is the most important thing in our profession. But the number of motor insurance policies is important and creates a problem, making it a very dangerous line of business. It’s like sailing in dangerous waters. The mirage of a large market share is beautiful but also dangerous”, he added.

Occasional claimant fraud is less of a problem as regards scale (it is the systemic approaches that are used by criminal gangs). Nevertheless there is an extensive level of fraud where the person involved in an accident opportunistically sees the chance to make a fraudulent claim. At the same time, in hard fraud there usually is no claim. The claim is invented by professionals, gangs or organized networks.

“Each market must create a fraud unit. Also, some standard procedures have to be implemented such as checking claims close to policy start dates, claims occurring after midnight with no witnesses, charge value “hit and run” losses, large value car “thefts” or policies with high frequencies of claims”, pointed out Muzaffer AKTAS.

Copyright © 2013. Stellar-Re.com





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