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How do you avoid losing money due to fraudulent claims, claims for services outside the scope of what you're insuring against, claims for ineffective resolution
by avalys 2y ago
How do you avoid losing money due to fraudulent claims, claims for services outside the scope of what you're insuring against, claims for ineffective resolutions to the claimed damages, etc.?
Am I supposed to know what a "scale-up insurance company" is?
- michaeljx 2y agoScale-up means youngish (10-12years old), mid-size in the countries we are operating, think 3 countries 600-800m revenue. Fraudulent claims are a tiny percentage of claims, and are rejected after human review, usually involving detectives. In the countries we operate, fraudulent claims are about 6-8% of all claims, and that's usually the level we aim to detect. Being able to absorb some false negatives is usually cheaper than going for the full 100% detection rate. It is definitely more customer oriented than rejecting due to false positives.
- avalys 2y agoIs this a health insurance company or are you providing property insurance?
- michaeljx 2y agoNo this is general insurance (motor, property, travel etc). It is also founder-led, which is an important factor, as the reason they started it was their personal frustration with the motor insurances.
- nradov 2y agoYour experience in general insurance has nearly zero relevance to US health insurance. Their main customers are large self-funded employers and they operate under a completely different legal regime. Most of their business is no longer even "insurance" in the traditional sense.
- motorest 2y agoOP's point is orthogonal to whatever legal regime is in effect. OP's point was that fraudulent claims are at a residual level. If anything, general insurance is expected to have higher rates of fraudulent claims than health insurance.