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Are Speedy Insurance Quotes Using the Internet Causing
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Are Speedy Insurance Quotes Using the Internet Causing Revenue Leakage to Insurers?

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Are Speedy Insurance Quotes Using the Internet Causing Revenue Leakage to Insurers?

  1. 1. wns.com – Insights – Blogs – Insurance Services Outsourcing Are Speedy Insurance Quotes Using the Internet Causing Revenue Leakage to Insurers? By Jeremy Owenson A recent article in the Post magazine revealed how Aviva had saved millio ns by clamping down on ghost broking. The article stated that the insurer took action after it discovered fraudsters posing as brokers were targeting non -English speaking immigrant groups in the UK through advertisements in foreign -language newspapers. This reminds me of a story I had read as a kid. I read a story on how a poor farmer got a snake into his house to get rid of the rat menace. And then days later, when the rats had cleaned up, he had to find ways and means to control the snake, which had become the next menace! I find a similar correlation between the rise of the Internet to simplify things and what I see slowly becoming ugly fall-outs. There is no doubt that the Internet has gone a long way in easing out long -drawn processes. What would take days at an end has now become accessible and possible with a click of a button. In the insurance context, one process that has clearly become a roaring success on the Internet, is the process of getting quotes. Insurance seekers would earlier have to rely on agents for days or weeks for getting a quote… but today, the Websites of insurance companies carry forms, which capture the relevant information (be it for car, home, life or any other insurance), and give out a quote within seconds of analyzing that information. There are also many online quote sites that allow insurance seekers to complete one form and receive quotes from multiple insurers within a few hours. Insurance seekers surely stand to benefit as they can make quicker purchase decisions, while the insurers are happy as they are able to get a client at a much reduced cost. However, not all insurance seekers are honest about what they disclose in the form. Insurers need to bear in mind that the same Internet-based quote retrieval system that gets them a client can also be misused by giving false information, in an attempt to get a cheaper quote. Some insurance seekers go as far as entering incorrect details to avail discounts being given for certain categories. For instance, in the car insurance space, instances of drivers in their twenties entering their age as over 50 in the forms to get special age-related discounts are on the rise. Many insurers begin their insurance details form on their Website with certain assumptions. An insurance seeker c ould easily choose to lie about these assumptions as well. Thus, an insurer could easily end up giving out a lower quote. The effect is known when the claim comes to the table, and it is too late for the insurer to cross -check all the details related to the policies. Claims leakage due to misrepresentation of identity or information is a growing matter of concern for insurers. Not having an Internet presence for insurance seekers is not an option anymore. So how does an insurer overcome this kind of misrepresentation over the Internet? It can be done by conducting thorough checks to ensure that all details entered by the person are correct. The focus here is not to delay issuing a policy, but to be able to detect the misrepresentation before a claim is made. It is better to incur loss of revenue by issuing a higher quote and losing a customer rather than paying out a high claim. The process of cross -checking information and identities is indeed an added task for an insurer, but a very critical one. It can easily be outsourced by giving a service provider access to the relevant databases so that it can identify the misrepresentations made over the Internet. A provider that has the right talent pool will be able to conduct checks on various parameters and cross-reference data to identify the misrepresentations, and effectively plug revenue leakage. http://www.wns.com/blogs/InsuranceServicesOutsourcing Confidential © 2010 WNS Global Services | w ns.com 1

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