May 2008 Counter Fraud Measures in a Flood? A presentation by CILA Fraud SIG CILA Conference 23 rd September Speakers: Christian Aplin – CILA AFG Chris Chambers - Ordinance Survey

May Getting the balance right Vast majority of claims will be genuine Distressing time for the insuring public Providing practical assistance Our obligations to Treat Customers Fairly Implementing major event plans Identifying those who take advantage

May Who can commit fraud in a flood? Policyholders Contractors Suppliers Staff

May How and when can fraud manifest itself in a flood event? Underwriting stage Claims Stage Throughout the lifecycle of a flood claim

May Fraud in a flood – Underwriting stage? Examples (not exhaustive) Lives on a known flood plain Within 500M of a watercourse Policy Inception after flood waters entered

May Fraud in a flood – Case example 1

May Fraud in a flood – Claims stage? Examples (not exhaustive) Exaggeration – scope/price of repairs Exaggeration – extent of affected items Staged – Hosepipe water vs flood water Misrepresentation – False documents

May Fraud in a flood – Case example 2

May Fraud in a flood – Traditional Tactics? Adjuster visits Indicator documents Use of broader supply chain Strengths & weaknesses of this approach

May Fraud in a flood – Alternative/ Emerging Tactics? Rules based detection systems Data Mining/Data Matching Mapping technology Internet Strengths & weaknesses of this approach

May Fraud in the floods – Example of the alternative tactics? 20 Minute presentation from Chris Chambers of OS? What OS mapping technology involves How mapping technology can help detect fraud How mapping can be used to detect fraud in a future flood event

May Counter Fraud Measures in a flood? Summary Vast majority of claims genuine Challenges of good service vs Major event vs temptation Understand the risks and respond appropriately Risk applies differing classes of business Ideally apply a combination of tools

May Counter Fraud Measures in a flood? One of our members reports on the portfolio of flood claims they received: 1% of claims investigated as fraud suspected 60%+ claims result in no payment Savings in excess £1M