Examining private sector strategies for preventing insurance fraud

Abstract

This chapter focuses on a complex phenomenon of fraud in the insurance industry. It reviews the literature on the nature of insurance fraud, differentiating among intermediary-, insurers-, policyholder- and internal fraud. The drivers of insurance fraud offending are considered through prisms of routine activity theory and criminological theory. Other reviewed studies suggest considering additional factors like public tolerance, public misunderstanding, boost of online services and weak crime control through cooperation. The chapter outlines the current trends in the industry, such as insurance aggregators, identity fraud, mobile applications and ghost brokers. It summarises the main preventative strategies adopted by insurers, which includes engaging with the public, using effective detection mechanisms and developing anti-fraud corporate culture, at the same time, pinpointing limitations in our knowledge and the potential ways to rectifying these.