Why does Hong Kong need an Insurance Fraud Prevention Claims Database (IFPCD)?
- To detect, combat and prevent insurance fraud, which is a serious criminal offence
- To stop honest policyholders from being penalized by paying higher premiums to cover the cost of fraud
- To deter fraudsters from committing fraud because they will be detected
- Hong Kong as an international financial hub needs to be in par with other major markets e.g. US, UK, Canada, Australia, China, Singapore, Malaysia, where a claims database already exists
An IFPCD will help…
To Consumers:
- An official deterrence mechanism to potential fraudsters
- Savings from fraud claims can lead to lower insurance premiums
To Insurers:
- A point of reference for claims assessors to take appropriate action
- An official platform for claims assessors to investigate claims compliantly
- A powerful tool to detect network or organized fraud involving multiple insurers, which is undetected today
To Hong Kong:
- An effective tool to combat criminal act and decrease crime rate
- Strengthen Hong Kong’s image as an international financial hub and ensure it is on par with other developed markets
Solution
The IFPCD is supported by the state of art AI technology provided by Shift Technology (https://www.shift-technology.com/), a French company based in Paris with an office in Hong Kong. Shift Technology confirmed that the IFPCD is European Union (EU) - General Data Protection Regulation (GDPR) compliant.
Methodology of the IFPCD:
- Data transfer
- Data pre-processing and cleaning
- Data enhancement
- Fraud detection: (i) Scenario-based detection and (ii) Network-based detection
- Display of results
- Improvement of detection
Through continuous development and improvement of analytics algorithms, the IFPCD will be able to identify information which are statistically validated to be indicative of fraud and alert insurers to potentially fraudulent claims that are normally hard to detect by claims handlers.