Future Insurance Fraud Detection (II): The 3 Revolutionary Methods of Big Data Analytics
Big data analytics brings about revolutionary changes for businesses, one of them is in the fraud detection area. Big data helps businesses by providing fraud detection insight that has never existed before. How does the implementation of big data works? The following are the three key models of big data implementation in helping insurance companies prevent fraud.
Insurance claim documents consist of several pages that when manually checked, would be time consuming and humanly impossible to run every detail in each page. Predictive modelling allows proactive fraud detection by identifying patterns and relationships between people and data (including weather data, voice recording, historical salary data, medical claims, weather, etc).
For example, a worker filed a claim for an eye incident. With predictive analysis, insurance company may find out the claimant’s conversation in a movie forum about the movie he just watched some time after the incident. This kind of information helps investigators examine the possibility of the claims detail being incorrect prior to the payment process.
Social Network Analysis (SNA)
Social media connects every individual in any part of the world in an unprecedented way. Millions of posts on social media generate enormous amounts of data that create social networks. The use of network theory to analyze social networks and social relationships has found application in many areas of security, including the track of terrorist activities, identifying secret trade, money laundering, and preventing fraud.
SNA allows companies to proactively conduct research on large data to find relationships through networks and nodes. For example, a car accident may look like a normal accident. However, when the examination with SNA was conducted, it turned out that one of the victim’s addresses or the vehicle was involved in many other insurance claims. Big data capability providing such information helps companies save time and provide insight into fraudulent parameters.
Social media is now an integral part of many companies’ digital strategies. It is essential for companies to integrate social media with their Customer Relationship Management (CRM). Through the use of information from social CRM, companies can deeply understand the consumers’ behavior trends, demands and preferences. Social CRM tools are able to search for millions of social media posts, including blogs, Twitter and other platforms to find the information they need.
For example, through CRM, investigators can determine whether the individual who filed for a claim has a relationship with another person involved in an accident. Investigators can also identify where the individual was in the event of the accident through GPS data. Such unstructured data help investigators retrieve information faster related to policyholder.