Insurance fraud is bad not merely because it potentially increases losses, but because fighting fraud tends to slow claims handling – which in turn reduces the quality of claim service and introduces process inefficiency. Quálitas (Mexico City; over US$1 billion in direct written premium), Mexico’s largest auto insurer, addressed that challenge with SAS Fraud Framework for Insurance, which enables early identification of fraud, and thus quicker payment of legitimate claims.
Quálitas – Latin for “quality” – is dedicated to an outstanding customer experience, according to René Abdala Mirwald, the insurer’s director of strategic planning and operational efficiency. “Customer service is very important to us,” he emphasizes. “Using analytics to help uncover suspicious or non-meritorious claims will enable us to pay meritorious claims faster with more confidence, while resisting non-meritorious claims, which will keep premiums down.”
Quálitas has implemented the SAS solution in a phased initiative designed to avoid interruption of day-to-day operations and support continuity of customer service, according to Abdala. The carrier expects the SAS capabilities to prevent large losses through timely detection of suspect activity, and by integrating extensive data to zero-in on fraudsters. By reducing false positives, the SAS solution enables insurer’s investigators to focus on fraudulent claims with the greatest impact on the business, which increases efficiency.
In partnership with SAS, Quálitas began its implementation of the SAS Fraud Framework for Insurance by cleansing internal data, followed by building out the user interface according to the needs of each business unit, according to Abdala. “Once the UI was built, we worked on building rules and models to populate the solution,” he says. “We had to adjust our current workflow in our case management system to fully take advantage of this technology.”
The final phase of the project was social network analysis to identify organized and provider/vendor fraud, according to Abdala. However, Quálitas plans to make further use of SAS technology within the enterprise, he relates. “First we will use SAS to decrease fraudulent claims,” he elaborates. “Then we plan to implement it internally to redue costs while nurturing our customers’ loyalty.”
Use of SAS’s technology is helping Quálitas to develop an enterprise approach to analytics, Abdala suggests. “We have many analytical projects being implemented across the company,” he reports. “Partnering with SAS allows us a more global view of our data and processes. As we grow, this will help us understand the risks and will allow us to make better fact-based decisions.”