This week is International Fraud Awareness Week – so it’s a good time to be thinking about fraud. But fraud is something insureds should actually be thinking about all year round.
Insurance Business spoke to
Nationwide vice president of external fraud Lynne Brady about protecting insureds from falling victim to fraudsters.
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Every business is at risk of being targeted by fraudsters, Brady said.
“Fraudsters are not picky as to a specific type of business they are attacking. Wherever they believe a company is vulnerable [they will attack]. And once you’re vulnerable and a fraudster knows they can ‘get in’, then word gets out.”
Fraud can take many forms: from insurance fraud, to corporate fraud, tax fraud, and identity theft, among others.
In terms of fraud claims that Nationwide sees, the criminal activities run the gamut, Brady said.
“It runs the course for all of our businesses – from credit card fraud to mortgage fraud, then you think about banks, annuity fraud, life, retirement plans, and then of course on the P&C side we have a lot of claim fraud, with staged accidents, medical provider fraud … the list just kind of goes on,” she said.
According to data from Nationwide’s third annual survey of 1,069 business owners, roughly 20% of business owners reported they were concerned about both internal and external fraud – which ranked fraud as one of the biggest business concerns behind cyberattacks, the Affordable Care Act, and tax.
“Fraud, often categorized as a white-collar offense, can be one of the most expensive crimes in America,” Brady said. “That’s why Nationwide invests in state-of-the-art, anti-fraud technologies, training and solutions that help business owners protect their companies. Our goal is to help owners by giving them the ability to detect and deter fraud perpetrated against them and their customers.
“Fraud is probably one of the top three, when it comes to business owners and their concerns for their businesses. They can [experience] one or two events and it really can cripple a small business. We, at Nationwide, are here to protect our members and our customers. Fighting fraud… is extremely important.”
The Association of Certified Fraud Examiners calculated that almost a quarter of occupational fraud cases resulted in a loss of more than $1 million, with the median loss for a fraud event being about $150,000.
Nationwide helps business owners with comprehensive training programs, which teach them how to uncover potentially fraudulently claims. This year, the company also released a new anti-fraud product – Fraudulent Impersonation coverage – which helps protect small-to-mid-sized businesses from impostors manipulating employees into transferring money under false pretenses.
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