One expert has noted that fraudulent tactics from overseas are now becoming more common in Singapore as the problem continues its global push.
Keith Swanson, director of Asia Pacific fraud and security intelligence for international firm SAS, said that insurance fraud is on the rise in Singapore as global scams have made their way to the country.
“Singapore is not immune to fraud – and a quick search online can provide cases that have made the news, including forays into staged accidents that have been prevalent in other markets such as the US and Australia for years,” Swanson told Insurance Business
“Observations of the market indicate that overseas trends have already hit Singapore, such as staged accidents, inflated claims, increase in soft tissue injuries, increased use of digital channels to drive policy purchase and increased level of misinformation provided to drive down premium quotes.
“To this, the consistency of challenges across markets can help emphasise that many economies, and more so in first world economies given the financial value, are seeing increasing impact from organised criminal activity that doesn’t see geography as a limitation to its efforts.”
Swanson pointed to reports that noted that, in 2013, the general insurance industry suffered S$140 million in losses from inflated and fraudulent motor insurance claims. While this only details one insurance market, it highlights the scale of the problem.
According to the Coalition Against insurance Fraud, the practice steals US$80 billion a year across all lines of insurance, comprising about 10% of property- casualty insurance losses and loss adjustment expenses each year.
Swanson noted that fraud presents “a challenge that is only increasing in scale and impact,” for the industry across the region as the rise in the use of technology throughout the insurance process, could encourage negative customer behaviour.
“The definition of fraud may not cover the full impact of the problem,” Swanson continued.
“Beyond blatant fraud, misrepresentation, providing inaccurate information, inflated repair claims, up-quoting and overservicing – all mean the challenge can range from policy quote to claims and beyond and can span insurance lines.
“Increasingly, as sales and services are becoming more digital, the trend to ‘fib’ on your policy quote or claim to reduce premiums or inflate claims is on the rise.”
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