Case Study Client Situation
Our client, a major Australian insurance company with a centralised claims division, processed over $1b of claims per year. Processes to detect and act on claims fraud were poor, and significant claims fraud / leakage was occuring.
Approach
Working with a joint client team, Pacific Strategy Partners developed an end to end process map of the fraud situation - including external market and perception factors. Over a three month period a fact pack and diagnosis was performed and agreed with the Steering Committee.
The team developed a series of initiatives across the end to end fraud process. The solution involved three streams.
- First, there was a stream of quick wins to achieve immediate fraud incidence reduction
- Second, there was a technology roadmap developed to improve the analytic and workflow tracking of fraud issues,
- Third, there was a program of initiatives and capability development over 12 to 18 months to bring the institutions fraud capabilities up to best practice.
Impact
A set of KPIs were developed to track improvement across the fraud process. For the client, there was greater awareness of fraud as an issue and hence a greater reluctance from customers to make soft or hard fraudulent claims.
Improved detection processes saw an increase in the fraud detection rate, and productivity of fraud investigators increased due to better case triaging. Short term savings of $14m p.a. were on track, and expectations were that the 2-3 year target or $20 to $30m pa should be achieved.
