Sean Kevelighan, the I.I.I.’s chief executive officer told a U.S. Senate Subcommittee in Washington, D.C., today that U.S. auto, home and business insurers pay an estimated $30 billion annually —nearly 10 percent of their total claim payouts—in fraudulent auto, home, and business insurance claims. To combat fraud insurers are increasingly turning to vendors who offer technological innovations stemming from big data and artificial intelligence. These vendors are allowing insurers to assess prospective customers, verify claims and identify suspicious activity in ways that were not previously possible.
In a report released last month, the Boston-based Aite (pronounced EYE-TAY) Group outlined the fact that insurers are recognizing their fraud-fighting efforts must adapt to this new era, and found reason for optimism. The Aite Group reports insurers are retaining state-of-the-art vendors, like data aggregators, producers, and receivers and then analyzing this data through the use of artificial intelligence and predictive analytics. The result? Insurance companies are equipping themselves with the high-tech tools they need to assess a prospective customer, verify a claim, and identify suspicious activity.
Click here for the full testimony.
Insurance Information Institute (I.I.I.) chief actuary James Lynch will be in San Diego at the Casualty Actuarial Society’s (CAS) annual Ratemaking and Product Management conference, March 27 to 29. Here’s a preview:
The I.I.I. partners with the CAS at its conferences. I generally write three or four articles based on conference sessions for the CAS Actuarial Review. These tend to be fairly meaty actuarial topics, but I try to make them digestible. Here is something I wrote about predictive models a while back.
At this meeting, I plan to write three more articles about predictive models. These are sophisticated models that draw on Big Data to help insurers serve their customers better.
Many, if not most personal insurers, use predictive models to price their products. Lately they’ve been developing models to help them settle claims quickly and accurately.
It’s an important, growing area in property/casualty insurance, particularly among actuaries and other quantitative experts. The CAS is recognizing the emerging skill through the CAS Institute – iCAS for short – its subsidiary that awards credentials for quantitative professionals.
The Institute’s first designation is for Certified Specialist in Predictive Analytics, or CSPA, and it will be awarded in a formal ceremony at the conference. I’ll be live-tweeting that event.