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If4 claims handling process 2021 (ALL of my study notes that helped me pass) READ THE SINGLE CARDS DECK IN PROGRESSIVE MIX > FRAUD > Flashcards

FRAUD Flashcards

1
Q

difficult to quantify insurance fraud because :

A

it can go undetected..

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2
Q

Quantifying Fraud, how?

A

by collecting data on the types and amounts of fraud is becoming increasingly important.

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3
Q

Identifying and quantifying the effects of fraud is the LAST step towards eliminating it?

A

FALSE,,,

Identifying and quantifying the effects of fraud is the FIRST step towards eliminating it

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4
Q

What is best undertaken at a strategic level??

A

Fraud prevention

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5
Q

What was The Insurance Fraud Bureau

(IFB) that was established in 2006 lead to do?

A

lead the insurance industry’s collective fight against Insurance fraud.

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6
Q

The Insurance Fraud Bureau

(IFB) acts as a central hub for sharing insurance insurance fraud data and intelligence :

A

True

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7
Q

The Insurance Fraud Bureau

(IFB) uses position at the heart of the industry and access to data to detect and disrupt organised fraud networks.

A

True

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8
Q

A wide range of data and intelligence to achieve objectives, how many?

A

TWO

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9
Q

What are the primary objectives the of the IFB?

A
  1. help insurers identify fraud and avoid the financial consequences; and
  2. support police, regulators and other law enforcement agencies in finding fraudsters and bringing them to justice.
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10
Q

The IFB also administers the Insurance Fraud Cheatline, which is run in association with Crimestoppers.

A

True

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11
Q

What does this provide the public with ??

A

a free and confidential tool to report suspected fraud: which is investigated,

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12
Q

A free and confidential tool to report suspected fraud, which is investigated, either by?

A

either by : the IFB or the police.

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13
Q

Another fraud prevention tool available to insurers other than the Insurance Fraud Bureau (IFB) is The Insurance Fraud Enforcement Department (IFED) of City of London Police, what does this prevention tool consist of?

A

A unique team of police officers and investigators, funded by a partnership with insurers through the ABI and Lloyd’s of London.

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14
Q

What does Insurance Fraud Enforcement Department (IFED) of City of London Police provide?

A

a specialist unit dedicated to tackling insurance fraud, in high volume, and organised criminality as well as opportunist fraud (exaggeration of a claim).

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15
Q

What is being harnessed in the drive towards fraud detection?

A

Technology

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16
Q

The use of pooled claims databases are :

A

where insurers can share information with a variety of other insurers.

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17
Q

With this practice (The use of pooled claims databases ), what benefits the insurers?

A

They can identify claimants who put in repeat claims by matching their new claims details against those already held.

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18
Q

What is Insurance Fraud Register and what is its function ?

A

An industry-wide register of known insurance fraudsters administered by the (IFB on behalf of ABI members). Holding details of proven fraudsters to help prevent future fraud being committed.

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19
Q

What is IFB Insurance Fraud Intelligence Hub (IFiHUB)?

A

An IFB initiative, developing an industry wide counter fraud sharing platform, where intelligence about fraudsters can be shared in real time.

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20
Q

What is the function of the Motor Insurance Anti-Fraud and Theft Register (MIAFTR 2)?

A

Contains details of all total loss and theft claims.

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21
Q

Insurers can therefore check using the ((MIAFTR 2) whether a total loss or theft of a vehicle is being
claimed for more than once.

A

True

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22
Q

What is Motor Insurance Database (MID) ?

A

was set up by the insurance industry and

contains details of all registered vehicles in the UK and the related insurance details.

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23
Q

MID assists the police in tackling motor vehicle crime by identifying uninsured drivers

A

True

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24
Q

What is Claims and Underwriting?

A

Exchange (CUE) is a database is shared by insurers across the country and contains information on personal lines claims from the previous three years.

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25
Q

Using (CUE) ,
Subscribing members submit their claims data on individual claimants and check the true claims history of those individuals.

A

True

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26
Q

What is the aim of the CUE?

A

to eliminate multiple claims on parallel policies held by a single insured.

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27
Q

What does the CUE register cover?

A

Domestic buildings and contents,

motor, and personal injury/illness incidents reported to insurers, which may give rise to a claim.

28
Q

What is compulsory for claimants’ solicitors in personal injury claims in the MoJ/Claims Portal ?

A

Compulsory for claimants’ solicitors bringing personal injury claims in the MoJ/Claims Portal to carry out checks against the database via askCUE

29
Q

In addition, it is compulsory for claimants’ solicitors bringing personal injury claims in the MoJ/Claims Portal to carry out checks against the database via askCUE

A

True

30
Q

Art Loss Register is founded by the insurance industry and the art world in response to increasing art theft,

A

True

31
Q

ALR operation relies on subscriptions from insurers?

A

TRUE

32
Q

What are the objectives of ALR?

A

increase the recovery rate of stolen art and antiques; and

deter theft by making the resale of stolen articles more difficult

33
Q

Who is this register available to?

A

The insurance industry, the art trade, law enforcement and customs agencies, collectors and museums.

34
Q

Who plays a vital part in detecting fraud?

A

Claims Handler…

35
Q

Methods of fraud detection vary across the classes of business,

A

True

36
Q

But there are many common FRAUD indicators, such as:

there are questions of this below, this just to read

A

claims made soon after a policy has been taken out;
• frequent change of insurer, which gives the impression that the claimant is trying to disperse the information held about them by frequent changes;
• uncharacteristic increase in the level of cover, e.g. a request to add accidental cover
halfway through the policy term;

• financial difficulties, which may not be immediately apparent but may come to light. For instance, when bank statements are provided to substantiate a loss of cash claim;
• prevarication by the insured;
• excessive pressure to settle;
• inconsistencies in the story given;
• lack of co-operation (a genuine claimant has nothing to hide and would want their loss to be remedied as soon as possible);
• poor or missing documentation, e.g. a total lack of receipts to substantiate purchase; and
• perfect documentation, which appears to be ‘too good to be true’ to the experienced claims handler.
Other measures within the insurance industry have also combated fraud, whilst actually
being implemented to enhance customer service and cut costs, for example:
• completing claims forms over the telephone: individuals often find it harder to lie directly,
as opposed to when merely filling in a form;
• claims settlement by replacement rather than cash: if a perpetrator claimed for a ‘stolen’
television to get cash, it would be frustrating for them to receive a replacement, which they would have to sell to get the cash (the fraud would still be successful, but this acts as a deterrent); and
• the use of cognitive behaviour tools to listen for inconsistencies in voice and action during the claims process.

37
Q

Why must insurers do to detect and eliminate fraud as much as possible?

A

In order to maintain a profitable account.

38
Q

For fraud detection, most of the larger insurers now employ?

A

one or more in-house fraud detection teams, tend to be staffed by insurance fraud detection experts.

39
Q

One or more in-house fraud detection teams, tend to be staffed by insurance fraud detection experts. who are they employed by?

A

Most of the larger insurers

40
Q

who are often people with experience in the surveillance or security services and the police?

A

Fraud detection experts.

41
Q

According to the Insurance Fraud Bureau, general insurance claims fraud exceeds £2.1bn per year.

A

True

42
Q

What are the consequences of fraud?

A

If a fraudulent claim is paid, it will have an impact on all the various parties concerned:
The insurer, the policyholders and fraudulent claimants.

43
Q

If individual insurers fail to take action on insurance fraud , what will it have an impact on?

A

their bottom line (profit), claims costs will rise, meaning premiums will too, making them less competitive.

44
Q

The case of Konstantinos Agapitos v. Ian Charles Agnew (2002) dealt with the

A

The judge decided that not only would a fraudulent claim fail completely, but that if a claimant instituted an authentic claim that was subsequently found to be exaggerated, this must also fail in its entirety.

45
Q

In the case of The case of Konstantinos Agapitos v. Ian Charles Agnew (2002) , the judge quoted Lord Hobhouse’s statement from the case of Manifest Shipping Co. Ltd v. Uni-Polaris Shipping (2001) (the ‘Star Sea’ case), where he said:

A

The fraudulent insured must not be allowed to think: if the fraud is successful, then I will gain; if it is unsuccessful, I will lose nothing.

46
Q

However, this case (The case of Konstantinos Agapitos v. Ian Charles Agnew (2002)) has now been superseded by the more recent Supreme Court decision in Versloot Dredging BV v. HDI-Gerling Industrie Versicherung AG and others (The DC Merwestone) (2014).

A

Initially, the Court of Appeal decided this case in line with Agapitos, so the whole claim failed because of the use of a fraudulent device being present in the pleaded claim.

47
Q

What were the The Supreme Court, response in relation to lies and recovery?

A

The Supreme Court, however, took a different view. It decided that an insured can tell lies in the presentation of a claim but still make full recovery from an insurer,

provided the lies were immaterial or collateral ones and that the claim is otherwise genuine as to liability and quantum.

48
Q

What is the logic behind the decision ??

A

The logic behind the decision is that neither party benefitted or was prejudiced by the lie.

49
Q

The case in question centred on an immaterial lie relating to irreparable water damage caused to the ship’s engine when a pump failed. The actual cause of the loss was an undetermined water leak. However, the ship’s captain in his statement said that the crew had failed to investigate a water alarm. In fact, there had been no alarm, but this was immaterial to the loss, which would have ruined the engine whether an alarm had sounded or not.

A

Because this lie was ‘immaterial’, the Supreme Court decided the claim should succeed.

50
Q

This now puts commercial insurance contracts on a par with the views of the Financial Ombudsman Service whose position has been that the historic precedent was unnecessarily harsh.
Their view is that, where the fraudulent act or omission makes no difference to the insurer’s ultimate liability under the terms of the policy, it should not entitle the insurer to ‘forfeit’ the policy or reject the claim.

A

TRUE.

51
Q

Claims made soon after a policy has been taken out?

A

Common indicator of fraud detection

52
Q

Frequent change of insurer, which gives the impression that the claimant is trying to disperse the information held about them by frequent changes;

A

Common indicator of fraud detection

53
Q

Uncharacteristic increase in the level of cover, e.g. a request to add accidental cover halfway through the policy term;

A

Common indicator of fraud detection

54
Q

Financial difficulties, which may not be immediately apparent but may come to light.
For instance, when bank statements are provided to substantiate a loss of cash claim, is an example of?

A

Common indicator of fraud detection

55
Q

Prevarication by the insured?

A

Common indicator of fraud detection

56
Q

Excessive pressure to settle; by the insured is an example of??

A

Common indicator of fraud detection

57
Q

Inconsistencies in the story given, by the insured is an example of??

A

Common indicator of fraud detection

58
Q

Lack of co-operation (a genuine claimant has nothing to hide and would want their loss to be remedied as soon as possible); so this is an example of?

A

Common indicator of fraud detection

59
Q

Poor or missing documentation,

e.g. a total lack of receipts to substantiate purchase; is an example of??

A

Common indicator of fraud detection

60
Q

Perfect documentation, which appears to be ‘too good to be true’, is an example of??

A

Common indicator of fraud detection

61
Q

There are other measures within the insurance industry have also combated fraud, whilst actually
being implemented to enhance:

A

customer service and cut costs.

62
Q

What are examples of other measures within the insurance industry to combat fraud??

A

• completing claims forms over the telephone: individuals often find it harder to lie directly,
as opposed to when merely filling in a form;
• claims settlement by replacement rather than cash: if a perpetrator claimed for a ‘stolen’
television to get cash, it would be frustrating for them to receive a replacement, which they would have to sell to get the cash (the fraud would still be successful, but this acts as a deterrent); and
• the use of cognitive behaviour tools to listen for inconsistencies in voice and action during the claims process.

63
Q

The use of cognitive behaviour tools to listen for inconsistencies in voice and action during the claims process, are examples of?

A

Other measures within the insurance industry to also combated fraud, whilst actually being implemented to enhance customer service and cut costs.

64
Q

Claims settlement by replacement rather than cash: if a perpetrator claimed for a ‘stolen’
television to get cash, it would be frustrating for them to receive a replacement, which they would have to sell to get the cash (the fraud would still be successful, but this acts as a deterrent); this is an example of?

A

Other measures within the insurance industry to also combated fraud, whilst actually being implemented to enhance customer service and cut costs.

65
Q

Completing claims forms over the telephone: individuals often find it harder to lie directly,
as opposed to when merely filling in a form; this is an example of?

A

Other measures within the insurance industry to also combated fraud, whilst actually being implemented to enhance customer service and cut costs.

66
Q

The other measures within the insurance industry to also combated fraud, whilst actually being implemented to enhance customer service and cut costs, is this correct?

A

TRUE,,,

(They also combated fraud, but actually being implemented to enhance customer service and cut costs).

67
Q

Who funds The Insurance Fraud Enforcement

Department (IFED) of City of London Police ??

A

by a partnership with insurers through the ABI and Lloyd’s of London.

If4 claims handling process 2021 (ALL of my study notes that helped me pass) READ THE SINGLE CARDS DECK IN PROGRESSIVE MIX (24 decks)

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