While 2023 is only just unfolding, we know that insurance fraud is not going away. Auto theft has become a national crisis with unprecedented numbers of vehicles going missing across the country that are either reVinned and sold to unsuspecting consumers, or sold overseas for even more illegal financial gain.
Insurance fraud is not a victimless crime. Not only is it driving up the cost of insurance for all honest, hardworking Canadians, making it a financial priority for insurers to tackle, but it has serious and devastating consequences for those affected by it. It erodes our public safety, consumes our benefits and congests our medical and judicial system, which is already suffering significantly. Victims of insurance crimes such as staged collisions can also suffer real and serious physical injuries ranging from broken bones to catastrophic impairment. It also fundamentally undermines the very system that was created to protect us. For all of these reasons, as good corporate citizens, insurers recognize they must take a stand against insurance fraud, both collectively and independently.
Today, companies are increasingly ramping up their focus on corporate social responsibility (CSR). In simple terms, “corporate social responsibility” means a business’s obligation to pursue achievable and good long-term goals for both its workforce and the world at large; it is the corporate embodiment of the outward mindset. Whether they are championing women’s rights, protecting the environment, or attempting to obliterate poverty, on a local, national, or global level, organizations with strong CSR mandates are working toward making the world a better, brighter, and more equitable place.
The insurance industry is no exception. Many of our members have robust and impactful CSR programs such as sustainability initiatives, diversity and inclusion programs, and philanthropic support. However, this desire to “do good” extends to tackling insurance fraud and crime as well.
Eradicating insurance fraud is a journey and, in April of 2021, the industry took a monumental step forward by establishing Équité Association: a single, unified, industry-wide organization focused on preventing and detecting insurance fraud. Stepping beyond their role as competitors in the marketplace, the industry is collaborating in an unprecedented way to help create safer communities for all Canadians.
However, our members have always and continue to work hard independently, behind the scenes, on behalf of their good customers in order to fight insurance fraud. For example, several decades ago, as part of their strategic response to fraud, insurers started creating specialized teams within their respective companies, known as Special Investigation Units (SIUs), or Anti-Fraud Management teams. These units were involved in identifying fraudulent schemes on the part of their insureds or claimants.
Since then, their mandate has remained the same, but they have transformed in their sophistication and knowledge base. Insurer SIUs today are able to quickly and efficiently identify high-risk claims by researching specific data within the company’s claims volume, while mitigating the risk of fraud losses to their policyholders. SIU professionals have backgrounds in criminal and civil investigations, law enforcement, business intelligence, analytics, and claims handling.
Insurance fraud in Canada has evolved in the past decade to include more organized crime, greater use of sophisticated technology and, a more recent transition to online fraud. As a result, Canadian property and casualty insurers have had to adapt and remain agile in response to a rapidly changing landscape.
Équité Association was born purposefully out of the fundamental principles of CSR, which include accountability, transparency, and ethical behaviour. We are the first and only organization in Canada dedicated to eradicating insurance fraud through cross-insurer investigations, advanced analytics, and intelligence. Équité Association is also member funded and supported, which demonstrates the insurance industry's commitment to CSR by tackling fraud and crime through partnerships, collaboration, and best-in-class data and analytics.
Undoubtedly, eliminating insurance fraud in Canada is a CSR issue and one about which Équité and its members are passionate. Together we are poised to make a significant, positive contribution to Canadian society, which is the goal of any good CSR program.