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Overcoming the Conflict Between Fraud Detection and Good Customer Experience

Customer experience is central to any carrier’s continued growth, but what are the hidden costs? What if improved product efficiency doesn’t provide a great customer experience? Do the two have to be mutually exclusive, or can they work together to create an optimized experience and product? 

Carriers have come to rely on the expertise of the people in their fraud departments to determine whether or not a claim is fraudulent, but can their time be better used? Is employing automated decisioning to drive operational efficiencies the key to this problem? Good data management and data sharing between departments can enable better fraud detection and CX, and insurers have to strike a balance between uncovering fraud and providing a top notch customer experience. 


This blog is based on “Overcoming the conflict between fraud detection and a good CX,” a session during Insurance Innovators Fraud & Claims virtual conference, with Carpe Data’s COO Geoff Andrews speaking with Scott Clayton, Head of Claims Fraud at Zurich; Adele Sumner, Head of Counter Fraud and Financial Crime at RSA; Jon Radford, SIU Claims Manager at QBE Europe; and Ami Fromson, Head of Fraud at Tesco Underwriting. 


What does the current customer experience-fraud conflict look like?

From the customers’ perspective, everything is virtual now, and there’s a huge demand for immediate connections. “It’s sharpened our focus on how we can catch the fraudsters fast and keep the honest customers going,” commented Adele Sumner. “It’s an ongoing challenge. The digital world has provided fraudsters with new opportunities, while the physical world has also changed the fraud landscape.”


Strike a balance

Knowing as much as you can before onboarding a customer, meaning no unnecessary validations, is important for a good customer experience. “Don’t interrupt the happy path of the claims process because you have to ask for more information,” warned Ami Fromson. “It’s all about the customer agenda. For instance, create fewer touchpoints and therefore there are fewer opportunities for the fraudster,” commented Scott Clayton. “Build multilayer detection, not the normal rules-based process, and basic things like previous claims history and ID validation into your fraud model. If you can do that, you have claims that can progress through the automation journey.”


[Related Reading: Claims and Fraud Transformation and Innovation]


Is it as simple as good data management?

“Good data management is important,” emphasized Geoff Andrews. “But having a good process, and adding technology to that process with internal and external data at the proper time is key.” Andrews went on to explain that carriers spend so much time identifying fraud, but data can help us identify who is NOT committing fraud, fast-track them, and provide a better customer experience in the process. “At the core of data combined with technology can do a few things: it can automate decisioning where appropriate and drive operational efficiency. This provides a lot of value to carriers, but efficient processes benefit the customer too, especially when carriers leverage technology in a way that allows claims that require expert attention to be routed to the right people internally. This way the carrier team members use their expertise and not have to sift through all the data where there is a lot of noise and distraction.”


So where does collaboration come in?

“The collaboration between insurers within the UK operate really well together,” Andrews pointed out. “And when it comes to individual carriers, the push for better collaboration comes from the top down from great leadership.” 

“The best thing to come out of the lockdowns has actually been an improvement in collaboration and education between claims and fraud departments,” Sumner said. “This improvement starts to permeate across the entire organization, sharing with the data executive team, underwriting, claims journey, and digital teams about what fraudsters are doing.”


Ready to learn how new data contributes to both fraud detection and customer experience in claims? Check out ClaimsX.