How Verisk partners with FRISS

Verisk announced the new collaborations with insurance technology companies designed to bolster fraud detection and analysis in the insurance claims process. As a leading vendor on this subject, FRISS will join the Verisk Claims Solutions ecosystem by integrating with Verisk's ClaimSearch platform, which includes the world's largest property and casualty (P&C) claims database containing over 1.7 billion claims from throughout the U.S.

This blog is based on a conversation between Yogesh Sapre, FRISS President for The Americas, and Shane Riedman, Vice President and General Manager Anti-Fraud Analytics at Verisk.

Insurance fraud costs the US $309 billion every year in higher premiums and elevated medical and legal costs. Now if we break that down further, you know the FBI estimates P&C fraud to be around 40 billion annually. That's higher than the GDP of of many, many countries. It's estimated that casualty fraud adds another 6.8 to nine $9 billion and auto casualty losses each year for work comp claim and premium fraud is estimated to be around 34 billion annually. This is a monumental challenge that we all have to solve and with all the changes in the industry and all the things that we all face, macro economic issues, cyber risk, climate change, natural catastrophes, regulatory changes, geopolitical issues, there's a whole host of things, and there's so many other concerns. The one thing that we as an industry could do is at least control the fraud. No one should have to pay higher premiums because someone else is cheating the system.

Shane;

Let’s for a second double down on the financial impact that fraud, waste and abuse has on the P&C industry. One of the things we've noticed is that there is no single sort of omnibus source of information or data about the loss that the industry absorbs every year due to due to these frauds, the numbers you mentioned are really high. I suspect that there are significantly higher than what we even see published because, some of those numbers don't exactly keep up with current research and trends. And sometimes there a little dated.

So the problem is gigantic and that's really how ClaimSearch got started. It was started by a group of insurance companies who came together more than five decades ago and realized that there is benefit to sharing intelligence across the community. 

So traditionally, a company says all of my information is my own. It's my trade secret.
It's my secret sauce. I'm not sharing it with anybody, but insurers realized that there was a benefit to an to share some claims information across the community because it ultimately protected the entire community.

Therefore preventing fraud in one spot can oftentimes stop reproducing it someplace else. The challenge is finding the multiple claims with multiple insurers for the same damages to the same vehicle. So one vehicle with multiple policies in some states, like Texas, that's illegal. But to stop those frauds, insurers have to share information and claim search is the platform where that sharing can occur. It started with just a couple of companies sharing claims information regionally. Then a couple of other companies got together and other regions and over time again over the course of roughly 50 years, we've helped bring all of those well used to call index bureaus.

We helped bring all of those index bureaus together into one place that covers every line of business, every casualty type, every property loss, every peril type. Just about any type of claim you can imagine that would occur in P&C can be transmitted across the claim. Regulatory referrals can be made off of that, and then of course, importantly, carriers can use a company like FRISS now to leverage that intelligence and that information to accelerate and to power the analytics that a company like FRISS delivers to the to the industry.

We're super excited to now make that platform available to our industry partners and we're really glad that FRISS is really the first to sign up and the first to join the platform.

Yogesh

We introduced the partnership at IFM this year and it really enables real time integration of ClaimSearch data to match reports within the FRISS suite of products.

Shane   

Just to clarify, this is always been sort of a point of confusion in the industry. Verisk does not sell data and that is probably the root and the heart of our strategy: we're selling an analytical service.
We've thought about that as a protected area that needs to be highly controlled and access needs to be highly limited. We still believe that it still needs to be highly controlled. This is some of the most sensitive data that exists in the P&C industry and access does need to be limited.

But what we realized is that by limiting access to only a certain category of customer, like an insurance company or a TPA or a law enforcement agency, we're really limiting our customers choice and selection for their service providers. We're limiting their choices and that's not the business we want to be in. That's not in the best interest of our customers and that's not the face in the and the and the perception that we want to have in the industry or in the community, we really want to change that perception.

This is one step in that direction. And that is that we are more of an open and inclusive network, more of an open and inclusive ecosystem or platform and that's really part of the strategy. To change that perception with our customer and showing our customers that we care to the point where we're gonna help them to make the best decisions for their business. 

Yogesh

That's awesome.
And obviously, we're the beneficiaries and we're grateful for Verisk allowing for us to be part of the ecosystem. And the reason this is important to FRISS is because claims history as provided by ClaimSearch is a key predictor of future fraud. It is as simple as that.
So under this partnership I think Verisk provides support across many, many lines for us. We're focused on all of personal and commercial lines, specifically auto property and casualty, including workers comp. The first use case that has been incorporated is the match report data. You know the prior claims history, the alerts, everything else within the scoring of our claims analytics. And that’s attached to another component of our suite, FRISS Enterprise Investigations. This is a case management system. We have now integrated the entire entity of the full claim search into our scoring models. 
These scoring models already had a vast and robust mechanism which is AI-driven and consist of expert models that have business rules and very specifically line of business rules within there; because each line of business is very unique and it's different and has its own characteristics around fraud. On top of that come text mining capabilities for analysis on word level and to scout for patterns. And then we also conduct deep network analysis; how the parties are interrelated to one another and last but not least, we rely on a very large number of third party data providers. Now with Verisk’s ClaimSearch we add literally the icing on the cake. 

Shane

What we're hearing from our mutual customers and from the industry is that there is definitely a lot of interest and a lot of concern right now about on fraud in photographs being submitted as evidence to substantiate a claim on. One thing that we're noticing is just when we talk to an insurance company and show them how the capability and how that technology works, where Verisk actually has the technology to identify fraudulent images and PDF documents and we test that with insurance companies that we often just see jaws drop because it spots fraudulent claims left and right.
And it's unbelievable how much activity there really is with altered images, altered receipts, and altered PDF documents. 

Yogesh

Let’s also quickly talk about the benefits of the partnership for mutual customers.

Reduce Claims Processing Time:

• Accelerate data analysis by consolidating external data sources and leveraging checks.

• Streamline claim review processes, increasing the case volume with the same number of staff;

• Boost customer experience and loyalty.

Enhance Investigation E­fficiency: 

• Streamline investigations with targeted data, reducing time and resources spent on false positives;

• Shorten the time from claim submission to payout;

• Save time for handlers and investigators as there's no need to switch between portals, which saves time for handlers and investigators.

Lower Cost Per Claim:

• Efficient STP processing and fraud detection reduce operational and claim costs;

• Enhance fraud detection capabilities to recover higher amounts from fraudulent claims;

• Enable more precise estimations of reserves needed for claims thanks to accurate real-time data

Shane

In our opinion, a P&C company who is not exercising or leveraging in advanced analytic is missing huge opportunities to, improve efficiency, improve accuracy, reduce loss ratios and ultimately provide the best possible service to their insurance to their customers.

Those are very real and tangible and measurable benefits, and I'll just I'll just mention from our perspective, there's the benefits that what a partnership like this provides to the insurance industry is also giving the insurance industry choice and giving carriers the ability to to safely and efficiently select a service provider that meets their needs and that fits their problems because we know that there is no such thing as A1 size fits all solution. 

We found that by giving customers choice and giving them the ability to select the services that make the most sense for their business, whether that's a service from FRISS or a service from another partner, giving them the choice is really powerful. And we think that's the biggest benefit for this for the industry and that's why we're standing behind our ClaimSearch partnership program; to give customers choice.

In for a sneak peek?
Go check friss.com/partner/verisk for a video of the integration.