LexisNexis Risk Solutions, a provider of information that aims to help customers across sectors predict, manage and assess risks, has launched a new data platform, LexisNexis Intelligence Exchange, to go live from January for insurers. This will be first such for life insurers and aims to help them on better risk segmentation through data, analytics and technology. This would be the first data repository or data bank in the country for insurers to better assess risks.
Shivakumar Shankar, managing director (India operation and development), LexisNexis Solutions, said life insurance continues to be challenged by fraud. This is the 14th such platform in the globe. For the company, the US was the first country where this platform was launched, about 30 years earlier. This platform will host policy and claims data, and will have the complete history of an individual. Data, including personal preferences (smoking, drinking) indicated in past policies, identity information and details of other insurance plans can be retrieved by the insurance company at the time of policy issuance. Further, insurers can check the seller history of an agent, branch of a bank, broker, direct sales employee. These would include claims, lapse and churn history and patterns, apart from sector-wide perspective. This exchange will be hosted in India utilising HPCC Systems technology. The latter is an open source, parallel processing computing platform for big data processing and analytics.
Insurance-related fraud in India is a big source of worry for life and general insurers alike. Sectoral officials say there are several organised entities which try to take fake insurance on either on the names of people who do not exist or are dead. They operate with fake names in several pockets in the country.
A report by Indiaforensic estimates fraud alone cost the insurance sector $6.25 billion (Rs 41,600 crore) a year, about nine per cent of premiums. These include misrepresentation and non-disclosure of relevant facts in the application, collusion between agents, diagnostic centres or investigators and the applicants/beneficiaries, and stacking of policies by beneficiaries. Section 45 in the new insurance bill says no claim can be repudiated after three years of a policy being in force. Hence, even if there is a fraud detected by the insurer after three years at the time of claim, it will have to be passed. Shankar said they also had a plan for a risk score, to classify as a good, mediocre or bad risk, to enable an insurer to decide whether they wished to insure that risk or not. Apart from receiving information about suspicious claims or those that warrant investigation, the platform will provide data so that genuine claims are settled quicker. It would also look at lapsation data and analyse the reasons.
LexisNexis has been working with life insurers in India for the past 18 months on this idea and will make the platform available to non-life insurers at a later stage. Since online purchase of insurance is also becoming popular, it is looking to have similar services for online customers which will be interactive in nature. Also, KYC and anti money laundering verifications, credit history verification can also be done via this platform.
Source: Business Standard India