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Motor Insurance Scams Lose Speed as MSIG Singapore Adopts AI

Motor insurance scams meet their match as MSIG Singapore and Fermion Merimen weed out fraudulent claims with the all-seeing gaze of artificial intelligence (AI).

General insurer MSIG Singapore has come together with Fermion Merimen to implement TrueSight Fraud Intelligence, an advanced AI tool developed to combat motor insurance fraud.

The tool leverages AI to analyse data gathered in Singapore and processed by insurers using Fermion’s e-claims system.

By presenting the aggregated results of automated checks performed on hundreds of data points as a visual network diagram, insurers are able to quickly identify scams as they occur.

This process addresses the issue of insufficient structured data to train the AI model effectively, which has been a root cause of inaccurate fraud detection in existing AI solutions in the region.

With this, it detects potentially fraudulent activities in real time, while the tool supports a scalable, accessible design applicable to insurers of all sizes.

“The sheer number of claims processed daily, coupled with their interconnectedness, makes it a huge challenge for insurers to detect fraudulent activities,” explains Sam Tan, senior vice president and head of claims services at MSIG Singapore, who adds that in the past, it has taken a combination of industry and in-house efforts to uncover insurance fraud.

“We believe that using a well-designed AI tool will enhance our success in combating fraudulent claims and help to reduce the cost of fraud,” continues Tan.

Side-by-side with AI

MSIG Singapore forecasts that the tool will automate at least half of its screening checks, ultimately freeing claims staff to focus on higher-value work such as interviewing claimants and assessing more complex claims.

The tool ensures the accuracy of the claims process, eliminating errors by corroborating each claim against the corresponding decision rules and thus reducing the risk of paying out to fraudulent claims.

With this, the insurer anticipates that the tool could produce $74,900 (SDG$100,000) a year in savings as a result of its ability to automate claims processes.

“With this new AI solution, we can rapidly uncover insurance fraud by cross-referencing data points. The tool offers, in one glance, the information needed to accelerate the claims management process,” comments Ivan Ho, assistant vice president of claims services at MSIG Singapore.

What’s at stake?

The general insurance sector paid out a total of $928milllion (SDG$1.24billion) in claims across all segments in 2021. Yet in 2017, the General Insurance Association of Singapore (GIA) reported that approximately one-fifth of all incurred motor claims are fraudulent.

“Existing AI fraud solutions in the region tend to lack accuracy in detecting fraud, generating high volumes of false alerts,” commented Agus Budiman, head of product development at Fermion Merimen.

“A root cause was insufficient structured data to train the AI model effectively. To rectify this gap, we decided to take it upon ourselves to overcome this challenge.”

For this reason, TrueSight Fraud Intelligence augments the claims data from Fermion Merimen’s e-claims management platform. The AI tool assesses the potential for fraud and makes recommendations once the platform processes the data.

Aggregated results of automated checks performed on hundreds of data points are then presented as a visual network diagram, accurately representing the whereabouts of different scams.

However, this isn’t the first instance of MSIG Singapore and Fermion Merime fighting fraud together. Back in 2019, the partnership produced TrueSight Interactive Video, a similar tool that combines video chat with motor insurance claims. Now, the pair’s latest venture into AI technology will address the front end of insurance claims.

“Insurers like MSIG with an admirable Kaizen spirit to innovate and serve customers better have inspired us to invest heavily in research and development,” concludes Tan.

“It’s our privilege to work closely with MSIG Insurance in Singapore to pioneer this solution and now we are looking ahead to roll this solution out to the rest of the industry.”

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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