Insurance Fraud Detection Market | Growth Of Advanced Analytics To Identify Threat Patterns Till 2025 With Key Players Include Accenture; ACI Worldwide, Inc. Etc.

Insurance Fraud Detection Market | Growth Of Advanced Analytics To Identify Threat Patterns Till 2025 With Key Players Include Accenture; ACI Worldwide, Inc. Etc.

Grand View Research, Inc. – Market Research And Consulting.
The global insurance fraud detection market size is expected to reach USD 9.7 billion by 2025, registering a CAGR of 13.7% over the forecast period, according to a new report by Grand View Research, Inc.

The global insurance fraud detection market size was valued at USD 4.1 billion in 2018 and is expected to register a CAGR of 13.7% from 2019 to 2025. Detecting and preventing fraudulent activities is a global challenge for insurers. However, the emergence of advanced solutions such as the use of automated business rules, self-learning models, text mining, predictive analytics, image screening, network analysis, and device identification is expected to deliver actionable insights to improve claims processes. As a result, insurance organizations are adopting fraud detection solutions that not only recognize the genuine claims process but also reduce the number of false positives.

The prevention and detection of fraud capabilities are increasing with the growing awareness of perpetrators and sophisticated crimes. Global concerns about the ever-increasing cases of insurance frauds coupled with sophisticated organized crime, have signaled a need for coherent action by all insurance companies. As per a research conducted by the Federal Bureau of Investigation (FBI), the total estimated cost of insurance fraud in the U.S. is expected to be more than USD 40 billion per year. As a result, in the U.S., it has led to an increased premium of approximately USD 420 to 700 per year for the average earning family. Similarly, according to the Association of British Insurers in the U.K., insurer unearthed more than 113,000 fraudulent claims and 449,000 dishonest insurance applications, valued at USD 1.3 billion. Thus, to curb fraudulent claims coupled with the various stringent regulations set by the government, enterprises are expected to adopt these solutions in the near future. These solutions are expected to enable an enterprise to identify fraudulent activities with higher speed and accuracy, thereby improving the consumer experience by realizing fast payouts.

U.S. insurance fraud detection market size, by component, 2015 - 2025 (USD Billion)

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In the insurance sector, fraudulent activities are primarily categorized as criminal and cultural. In criminal type, professional perpetrators habitually try to identify a weak system to attack. While in cultural type, a genuine claimant is opportunistic by exaggerating a claim. With the help of data analytics, insurance companies can analyze and detect the possibility of fraudulent activities. The user can enter data, and claim applications are automatically given a score to indicate the likelihood that scam has occurred. Thus, the use of predictive modeling can potentially produce a quantified score that helps a company to understand the propensity of a scam. Monitoring the arrived score through the use of advanced solutions is expected to show more accurate and effective results than that of traditional fraud detection methods. However, relying solely on technology for suspecting the fraudulent activities to be flagged is expected to be a key challenge for the insurers. Thus, to overcome such challenges, analysts are required to initiate immediate action and follow appropriate measures to help the company reduce losses.

Organization Insights

The large enterprise segment is anticipated to dominate the market over the forecast period. The prominent insurance providers globally spend millions of dollars on advertising to influence customer perceptions. This helps the insurer to reach out to the maximum customer as well as build more consumer base by enticing them through discounts in the market. As most of the customers are registered with large enterprises, they have large claims process to handle every day. It is often witnessed that most of the claimant exaggerate to obtain various benefit or advantage they are not entitled to, or when an insurer knowingly denies the claims. In such a case, a claimant may take multiple illegal methods to ensure that request claim is reimbursed. Thus, growing fraud cases such as stolen cars, car damage, unnecessary medium procedure, and fraudulent health insurance billing have created a need for insurers to adopt advanced solutions to address such fraudulent activities.

Global insurance fraud detection market share, by organization, 2018 (%)

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Further key findings from the report suggest:

  • Solutions segment held the leading market share in 2018 and is expected to continue leading over the forecast period

  • Managed services segment is anticipated to exhibit the fastest CAGR of 15.6% over the forecast period

  • Large enterprise segment dominated the market with highest revenue share in 2018

  • The Asia Pacific region is anticipated to witness the fastest CAGR over the forecast period

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Grand View Research has segmented the global insurance fraud detection market on the basis of component, solutions, services, deployment, organization, and region:

Insurance Fraud Detection Component Outlook (Revenue, USD Million, 2015 – 2025)

  • Solutions

  • Services

Insurance Fraud Detection Solutions Outlook (Revenue, USD Million, 2015 – 2025)

  • Fraud Analytics

  • Authentication

  • Governance, Risk, and Compliance (GRC)

Insurance Fraud Detection Services Outlook (Revenue, USD Million, 2015 – 2025)

  • Professional Services

  • Managed Services

Insurance Fraud Detection Deployment Outlook (Revenue, USD Million, 2015 – 2025)

  • Cloud

  • On-Premise

Insurance Fraud Detection Organization Outlook (Revenue, USD Million, 2015 – 2025)

  • Small & Medium Business (SMB)

  • Large Enterprise

Insurance Fraud Detection Regional Outlook (Revenue, USD Million, 2015 – 2025)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

  • Asia Pacific

    • China

    • India

    • Japan

  • Latin America

    • Brazil

    • Mexico

  • MEA

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About Grand View Research

Grand View Research provides syndicated as well as customized research reports and consulting services on 46 industries across 25 major countries worldwide. This U.S.-based market research and consulting company is registered in California and headquartered in San Francisco. Comprising over 425 analysts and consultants, the company adds 1200+ market research reports to its extensive database each year. Supported by an interactive market intelligence platform, the team at Grand View Research guides Fortune 500 companies and prominent academic institutes in comprehending the global and regional business environment and carefully identifying future opportunities.

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