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Fraud checks get red flag from Absolute

Insurers’ traditional methods of identifying likely fraudsters are outdated, discriminatory and cost the industry millions of pounds, says specialist fraud solutions provider Absolute Customer Management.

Traditionally, insurers use red flagging which covers issues such as race, gender and the area in which a claimant lives. Absolute says this often means that young men, especially those from a deprived area or from an ethnic minority are discriminated against and considered high risk.

But the company says its experience in managing cla- ims for insurance companies shows that the average fraudster is far more likely to be a white, middle-aged and middle-class professional exag- gerating a genuine claim or lying about circumstances.

Director of customer management Gabrielle Stewart says: “We have found that every section of society has a percentage that will commit insurance fraud. The vast majority of insurance fraud is opportunistic, people exaggerating a genuine claim or lying about circumstances, and often comes from middle aged professionals who are not traditionally thought of as fraudsters.”

But Norwich Union spokes-man David Ross says: “Where is Absolute’s evidence? It is absolute nonsense to suggest that we primarily target young men from ethnic minorities or deprived backgrounds. We successfully identify 15,000 fraudulent claims per year and have spent years looking at different triggers that may make people more liable to commit fraud.”

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