Claims data from LexisNexis Risk Solutions to help solve home
insurance market's application and claims fraud challenge
LONDON, June 2, 2021
/PRNewswire/ -- The extent of the challenge that home
insurance providers confront in pricing insurance accurately and
reducing exposure to fraud has been revealed in a studyi
of over 3,000 UK homeowners and renters by LexisNexis® Risk
Solutions, the data, analytics and technology provider for the
insurance sector. Two in three of the homeowners and renters
surveyed felt it was fine to manipulate the truth to get a cheaper
quote online, with ABI fraud dataii suggesting this
typically consists of non-disclosure of previous claims.
The research from LexisNexis Risk Solutions also demonstrates
that there is an urgent need for home insurance providers to know
more about past claims related to the individual and the property –
for use at pricing and underwriting as well as to support the
claims process. This insight could become more important to help
tackle any rise in fraud resulting from the pandemic and as the
market prepares for the FCA's pricing remediesiii.
The research detailed in the White Paper, A Clearer View of
Claims to Help Fight Fraud, found:
- 2 in 3 consumers think it is acceptable to manipulate the
information they provide when using price-comparison websites in
order to get a lower quote for home insurance.
- About half of consumers who have recently filed a claim are
more likely to consider adjusting or exaggerating a future claim in
order to get a larger pay out.
- Nearly 9 in 10 consumers who have filed claims recently think
home insurance providers seek to avoid paying out on claims at
least some of the time.
- Consumers who have recently filed claims and subsequently see
their premiums increase are more likely to say it is acceptable to
manipulate information.
Neill Slane, senior manager,
claims, UK & Ireland, of LexisNexis Risk Solutions
said: "Home Insurance is a highly competitive line of business with
very little movement in premiums over the past seven
yearsiv. Insurance providers need to differentiate
themselves in pricing and claims, as well as tackle the common
misconception identified in our research that they actively try to
avoid paying out claims at least some of the time.
"Understanding and applying this insight has become even more
important with the FCA's new pricing regime on the horizon and in
recognition of the fact that in times of economic hardship,
individuals under financial stress may be tempted to exploit
opportunities to commit fraud. This could be not declaring a past
claim for a cheaper quote or exaggerating an accidental damage or
weather-related claim.
"Fundamentally, home insurance providers need a much more
granular understanding of past claims to help inform every part of
the customer journey to improve pricing, underwriting and claims
processing, as well as reduce fraud risks. The market-wide claims
contributory database we are now building will offer that level of
insight, providing the basis for building a faster, more seamless
quote and claims experience, and as a means to boost fraud
detection."
About LexisNexis Risk Solutions
LexisNexis® Risk
Solutions harnesses the power of data and advanced analytics to
provide insights that help businesses and governmental entities
reduce risk and improve decisions to benefit people around the
globe. We provide data and technology solutions for a wide range of
industries including insurance, financial services, healthcare and
government. Headquartered in metro Atlanta, Georgia, we have offices throughout
the world and are part of RELX (LSE: REL/NYSE: RELX), a global
provider of information-based and analytics and decision tools for
professional and business customers. For more information, please
visit www.risk.lexisnexis.co.uk and www.relx.com.
Media Contacts:
Alison
Reeson, Clare Watson,
Parm Heer or Jane Lewis at HSL
0208 977 9132, 07876 597466
lnrs@harrisonsadler.com
Regina Haas
Senior Director, Communications
Insurance and Connected Car
LexisNexis Risk Solutions
O: +1.678.694.3569
M: +1.678.896.1463
Regina.Haas@lexisnexisrisk.com
i LexisNexis Risk Solutions was not identified
as the sponsor of this research, which was based on an online
survey of 3,083 residential homeowners and renters (including 1,576
homeowners and 1,507 renters). The research was completed during
2019.
ii https://www.abi.org.uk/news/news-articles/2020/09/detected-insurance-fraud/
iii https://www.fca.org.uk/news/press-releases/fca-sets-out-proposals-tackle-concerns-about-general-insurance-pricing#revisions
iv https://www.consumerintelligence.com/home-insurance-price-index
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