Canadian Underwriter

Insurer calls for online database of auto fraud perps

December 7, 2018   by Greg Meckbach

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Health clinics and auto repair centres involved in auto insurance fraud should be named in an online database that is easily accessible to consumers, Aviva Canada suggests.

“The fact that there is a small but sophisticated minority out there who take advantage of the system – for their own benefit and in so doing, are driving up the cost of insurance for consumers – is unacceptable to all of us,” Chris Lang, senior manager of fraud operations for Aviva Canada, said in an interview.

In an Aviva-commissioned consumer survey, a majority (60%) of 1,500 Ontarians with an insurance policy said they would support what Aviva calls an  “online fraud intelligence database,” the insurer said Tuesday.

The idea is to have a database that consumers can readily access to ensure they are dealing with reputable suppliers following a car accident, Lang told Canadian Underwriter in an interview.

Aviva says some healthcare facilities have coached auto accident claimants to exaggerate injuries. Some have had patients sign blank treatment orders, which are then submitted to insurers to obtain payment for services that were never provided. Aviva has also found some collision repair centres that exaggerate accident damage in order to charge higher amounts than they should have.

To create an online database, insurers would need to agree on “a standard for what constitutes fraud on the part of a supplier, how one would get on to a list in the first place” and how a supplier could get removed from the list, Lang said.

Insurers would need to agree on how a database is governed and on how it would be kept up to date and accurate.

In the consumer survey, conducted by Pollara Strategic Insight for Aviva, more than two thirds (72%) said they would use an online database to search for an auto body shop following a car collision.

The results are considered accurate within plus or minus 2.5 percentage points, 19 times out of 20. Pollara did the online poll in October.

A slight majority (58%) of those polled said they would use a fraud intelligence database to look up a healthcare practitioner for treatment of injuries following a car collision. More than two thirds (70%) said insurance companies that have uncovered fraud schemes should make the information available to the public in real time.

Aviva estimates that auto insurance fraud costs the Canadian industry up to $2 billion a year.

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