Insurance Fraud Detection Market Size
|Fastest Growing Market:||Asia Pacific|
|Largest Market:||North America|
|CAGR:||< 17.4 %|
*Disclaimer: Major Players sorted in no particular order
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Insurance Fraud Detection Market Analysis
The insurance fraud detection market is expected to register a CAGR of over 17.4% during the forecast period. Organizations' adoption of technologies like Big Data, the Internet of Things (IoT), artificial intelligence (AI), and machine learning is transforming business processes continuously and enhancing digital readiness. However, technological development has also made it easier for criminals to attempt cyberattacks and scams for their advantage.
- Fraudulent actions, including conspiracies, theft, money laundering, embezzlement, and extortion, are increasingly essential difficulties for a company in an expanding threat ecology. Insurance fraud cases have gained notoriety globally over the past few years, costing insurance companies billions of dollars. As a result, insurers are adopting cutting-edge automation and analytics solutions as proactive measures to mitigate and reduce losses caused by fraud.
- Fraudulent claims in the insurance industry have steadily grown to be the most significant expense to property and casualty insurers, taking up to 10% of an insurer's revenue. In the UK, detected fraud is estimated to be more than USD 1 billion annually, with undetected fraud adding more than USD 2 billion, according to the Marketforce General insurance report & Insurance Fraud Taskforce.
- According to Coalition Against Insurance Fraud, in the US, fraudulent claims losses from fraudulent claims are estimated to be approximately USD 80 billion a year across all insurance lines. These exorbitant expenses are generally passed on in the form of rising premiums.
- The primary factors driving the market's growth are the need to successfully oversee tremendous volumes of characters by associations, improve operational proficiency, and upgrade the client experience.
- Due to a rise in the frequency of hospitalizations of infected individuals, the COVID-19 pandemic increased insurance claims across the board in several industries, particularly in the healthcare sector. The number of fraudulent claims increased significantly along with the increase in healthcare-related claims. To identify fraudulent claims and stop losses, insurance firms are implementing cutting-edge technologies and using data. To safeguard loyal clients, they also participated in cross-industry anti-fraud cooperation. Several insurance companies implemented digital transformation projects to identify complex and developing fraudulent insurance claim activities.
Insurance Fraud Detection Industry Segmentation
Insurance fraud detection software prevents, detects, and manages fraud across the enterprise, making smarter decisions, increasing return on capital, and driving business performance. Types of solutions such as fraud analytics, authentication, governance, risk, and compliance are considered under the scope of the report.
The Insurance Fraud Detection Market is segmented by Component (Solution and Service), Application (Claims Fraud, Identity Theft, Payment and Billing Fraud, and Money Laundering), End-user Industry (Automotive, BFSI, Healthcare, and Retail), and Geography. The market sizes and forecasts are provided in terms of value (USD million) for all the above segments.
|Payment and Billing Fraud|
|By End-user Indsutry|
|Other End-user Industries|
|Middle-East and Africa|
Insurance Fraud Detection Market Trends
This section covers the major market trends shaping the Insurance Fraud Detection Market according to our research experts:
Claims Fraud to Hold Significant Share
- The decreasing economic growth in developed countries and the slow economic growth, coupled with macroeconomic uncertainty in emerging and third-world counties over the past few years, have resulted in a marked increase in the amount of insurance fraud committed.
- For instance, insurers have identified 80 districts across India that have excelled in fraudulent claims over the past decade. They have identified rings that operate with the efficiency of a corporation with well-trained men and women who collect data with the efficiency of a 21st-century start-up.
- A combination of poor due diligence in writing policies by insurance companies and the organizational efficiencies of criminals in identifying those who are on deathbeds and in enlisting doctors to produce fake certificates led to frauds estimated to have cost over INR 10,000 crore annually to the industry in the country.
- A survey by UK comparison website Gocompare.com found that 7% of 18-to-34-year-old UK holidaymakers admitted to exaggerating a claim on their travel insurance policy or making up the claim. In the UK insurance industry as a whole, the insurers uncovered 350 cases of fraud worth USD 3.6 million every day, according to the Association of British Insurers (ABI).
- According to the South African Insurance Association, local insurance fraud aligns with international trends and statistics. The association estimates fraudulent claims in South African insurance could amount to as much as 32% of all claims submitted in any year.
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North America to Hold Major Share
- North America is anticipated to hold a major share of the Insurance fraud detection market. The criminals are looking forward to profiting from the people across the region. As most people in the region have health insurance, free medical treatments or complementary consultation offers are being stolen.
- The total cost of P&C insurance fraud is more than USD 80 billion per year in the U.S. alone, according to the Coalition Against Insurance Fraud. This indicates that insurance fraud costs the average U.S. family between USD 400 and USD 700 per year in the form of increased premiums.
- Such cases of fraud in health insurance are causing damage to people's medical history. A few years back, it was difficult for healthcare providers to identify the fraud, as criminals were using all types of patient identifications and insurance information. Due to such frauds, patients are compelled to pay higher premiums.
- The Federal Bureau of Investigation mentioned that private and public healthcare fraud is an estimated 3% - 10%t of total healthcare expenditures. According to the U.S. Department of Health and Human Services Centers for Medicare and Medicaid Services' data, healthcare fraud amounted to between USD 77 billion and USD 259 billion.
- Therefore, the U.S. healthcare department is more focused on reducing such cases by implementing fraud detection technology. Consequently, it is anticipated that owing to the rising fraudulent activities in the U.S. healthcare department, the market studied would witness significant growth over the forecast period.
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Insurance Fraud Detection Industry Overview
The insurance fraud detection market comprises several global and regional players vying for attention in a fairly contested market space. Although the market studied poses moderately high barriers to entry for new players, several new entrants have gained traction in the market. The market is also witnessing increased competition among the players. The players focus on engaging themselves in partnerships, mergers, acquisitions, and product innovations to gain a competitive advantage.
In March 2022, a partnership was established between Equifax's analytics and technology business and Truepic, a provenance-based image and video verification provider. Through the association, Truepic Vision, the company's premier digital inspection platform, will be added to Equifax's fraud protection services for its insurance customers, giving real-time transparency and confidence to digital photo and video transactions from anywhere.
Insurance Fraud Detection Market Leaders
BAE Systems Inc.
SAS Institute Inc.
Lexisnexis Risk Solutions Inc.
*Disclaimer: Major Players sorted in no particular order
Insurance Fraud Detection Market News
- Nov 2022: Sentinel, a collection of commercial entity fraud detection solutions, was introduced by Experian, a leading provider of information services worldwide, to assist lenders and insurers in preventing fraud and safeguarding small- to medium-sized businesses. Multipoint Verification, Identity Velocity, and Commercial First Party Fraud Score are the solutions included in the suite.
- Jun 2022: Fiserv, a provider of payments and financial services technology, and Advanced Fraud Solutions (AFS) announced a partnership that will enable Fiserv, financial institution clients, to automate fraud detection checks, risk-based funds availability, and decision-making processes, reducing losses and spotting fraudulent deposits before they are accepted.
Insurance Fraud Detection Market Report - Table of Contents
1.1 Market Definition and Scope
1.2 Study Assumptions
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Stakeholder Analysis
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Consumers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Need to Effectively Manage Huge Volumes of Itentities
5.1.2 Improved Operational Efficiency and Enhanced Customer Experience
5.2 Market Restraints
5.2.1 Lack of Awareness Regarding Fraud Detection Solutions
5.3 Impact of Covid-19 in Insurance Fraud Industry
6. MARKET SEGMENTATION
6.1 By Component
188.8.131.52 Fraud Analytics
184.108.40.206 Governance, Risk, and Compliance
220.127.116.11 Other Solutions
6.2 By Applcation
6.2.1 Claims Fraud
6.2.2 Identity Theft
6.2.3 Payment and Billing Fraud
6.2.4 Money Laundering
6.3 By End-user Indsutry
6.3.5 Other End-user Industries
6.4.1 North America
18.104.22.168 United States
22.214.171.124 United Kingdom
126.96.36.199 Rest of Asia-Pacific
6.4.4 Latin America
6.4.5 Middle-East and Africa
7. COMPETITIVE LANDSCAPE
7.1 Company Profiles
7.1.2 BAE Systems Inc.
7.1.3 IBM Corporation
7.1.4 SAS Institute Inc.
7.1.5 Experian PLC
7.1.6 Lexisnexis Risk Solutions Inc.
7.1.7 Iovation Inc.
7.1.8 Fiserv Inc.
- *List Not Exhaustive
8. INVESTMENT ANALYSIS
9. MARKET OPPORTUNITIES AND FUTURE TRENDS
Insurance Fraud Detection Market Research FAQs
What is the study period of this market?
The Insurance Fraud Detection Market is studied from 2018 - 2028.
What is the growth rate of Insurance Fraud Detection Market?
The Insurance Fraud Detection Market is growing at a CAGR of <17.4% over the next 5 years.
Which region has highest growth rate in Insurance Fraud Detection Market?
Asia Pacific is growing at the highest CAGR over 2018-2028.
Which region has largest share in Insurance Fraud Detection Market?
North America holds highest share in 2022.
Who are the key players in Insurance Fraud Detection Market?
FICO, BAE Systems Inc., IBM Corporation, SAS Institute Inc., Lexisnexis Risk Solutions Inc. are the major companies operating in Insurance Fraud Detection Market.
Insurance Fraud Detection Industry Report
Statistics for the 2023 Insurance Fraud Detection market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Insurance Fraud Detection analysis includes a market forecast outlook to 2028 and historical overview. Get a sample of this industry analysis as a free report PDF download.