Monday, July 24, 2017

Use analytics to drive growth, cut insurance fraud

Rich data captured and managed to professional standards helps create information assets that a company can capitalise on. file photo | nmg Rich data captured and managed to professional standards helps create information assets that a company can capitalise on. file photo | nmg 
Business success is increasingly becoming characterised by accelerated innovation. The most important test for any company in competition is by gaining information advantage; an information advantage improves the quality and impact of critical business decisions.
For example, in the 2016 insurance fraud risk survey by KPMG, 37 per cent of the respondents in the East Africa region use analytics to understand their fraud exposure or to drive fraud strategy.
In the report, Kenya was unable to quantify the detected volume of policy fraud and had a low number of detected claim fraud cases compared to Tanzania but higher than Uganda.
It did, however, have the highest scores for estimated per cent of policies and claims that are fraudulent. This would support the perception that there is insurance fraud in the region and is largely undetected, especially as fraud arises in both policy and claims.
The relationship between the consistent use of analytics to detect or deter fraud and the reduction of costs incurred is no coincidence.
The fraud detection process through analytics is made up of rich data, meaningful rules, smart capabilities and efficient technology. Rich data captured and managed to professional standards helps create information assets that a company can capitalise on.
For a business to gain benefit in actionable insurance analytics, management must make a conscious effort to significantly improve the organisation’s data quality, governance and management.
Insurance analytics is proving to be useful in profiling and segmenting customers including a 360-degree view of a customer. This is very beneficial in cross selling of products.
It answers the question, “Who do we target and how do we sell it to them?”
gogoti@kpmg.co.ke

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