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EGROUP PREVENTS FRAUDULENT CLAIMS PAYMENTS, WITH ESTIMATED SAVING OF £65,000 IN FIRST 3 MONTHS ALONE

Case Study: eGroup

Challenge
Whilst online has been a huge success for insurance companies, the one area it has struggled has been controlling risk and fraudulent applications.

eGroup, one of the fastest growing direct insurance businesses in the UK with a forward-thinking Risk Team, had been looking for a solution to fill this gap.

The biggest challenge eGroup faced was predicting which applicants carried potential risk in a timely fashion, rather than reacting after an issue had occurred.

Solution
RedEye worked with eGroup to understand the elements of an application signifying high risk. Using this information RedEye configured a custom Risk Alert programme specifically designed to identify high risk applications. RedEye’s powerful web analytics technology was able to extract accurate data concerning eGroup's online users and highlight any suspicious behaviour.

On a daily basis the Risk Team at eGroup received automatically delivered reports flagging any applications needing further investigation. This information was then used to contact the suspect applicants and investigate if they were fraudulent or not before the application was approved.

Tom Dance, Fraud Analysis Team Manager at eGroup said,“The daily reports are a key player in us identifying suspicious policies immediately after inception. The nature of the process allows us to rapidly contact the policyholder to confirm or deny any suspicions of fraudulent usage we may have. This results in the team working extremely quickly and efficiently, meaning we can get the customer off cover before a claim is reported.”

Results
Over a 3 month period the following results were achieved:

•Over 700 potentially false applications were identified.
•204 applicants were removed from cover, valuing over £77,000 in Insurance Premiums.
•Approximately 500 applicants were investigated further or were passed to the Validations or Claims Departments to verify. (The remainder were cleared as genuine.)
•Based on the average payout per £ of premium, eGroup would have received an approximate claims loss in excess of £65,000 had they not implemented RedEye’s Risk Assessment Reporting.
•An ROI of over 480% was achieved over the quarter.

David Pugsley, Payments and Fraud Manager at eGroup said,“The processes implemented by RedEye are certainly having a major impact in identifying a vast number of non-disclosures and potential fraudulent applications before claims are made. We are very happy with the results and although the process has only been live for a matter of months we are already seeing thousands of pounds in savings from potentially fraudulent applications.”

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