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  • June 2021
  • 5 minutes

Life Insurance Fraud in the Time of COVID-19

More then one year into the pandemic, RGA experts reflect on lessons learned

  • Mark S. Dion
  • Alan Hobbs
  • Colin M. DeForge
  • Bob Gooderl
  • Alex Bunte
  • Karen Riendeau
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In Brief
In 2020, RGA produced a five-part series of articles exploring life insurance fraud in the time of COVID-19 as a lead-up to the RGA Fraud Conference. 

Life Insurance Application Fraud in the Wake of COVID-19

Alan Hobbs, Vice President, Underwriting Services, U.S. Markets

More than anything, I’d like to applaud the industry as a whole for its COVID-19 response. Insurance is often derided as slow-moving and behind the times, yet last year we executed a quick and coordinated response to unprecedented challenges affecting every aspect of our business. Without face-to-face interaction and established forms of validation, we leveraged new technologies and new evidence sources to process applications – changes that would have otherwise taken years to adopt. Now some of the adaptations we assumed would be temporary appear to be permanent. How this will impact life insurance fraud has yet to be determined, but it seems likely we may have created some new openings for fraudsters to exploit. The key moving forward will be to follow the same basic steps I laid out in the article last year: stay calm, innovate, remain vigilant, and work together.

Make It Known: Practical Steps for Underwriters to Combat Fraud amid COVID-19

Colin M. DeForge, Executive Director, Underwriting, U.S. Mortality Markets

The pandemic put alternative underwriting evidence to the test, and I think what we learned is a mixed bag: Applying new data sources enabled insurers to underwrite business that would have otherwise been lost, but at this point many cases still require traditional evidence from sources such as lab tests and physician’s statements. Monitoring the actual results of accelerated underwriting processes will be essential to prevent fraud from creeping in. COVID-19 increased general awareness for the need for life insurance, and now we should increase awareness of the need for prudent underwriting – that it not only helps protect insurance companies from fraud, but also allows those companies to offer better rates to consumers.

Sweat the Small Stuff: Preventing Insurance Fraud during Policy Administration

Bob Gooderl, Vice President, Administration Oversight and Alex Bunte, Executive Director, Assumed Administration, Reporting and Deal Team

Last year, we wrote about the importance of attention to detail in administering insurance policies amid so much workplace disruption. With remote or flexible working situations likely permanent for many and with fraud on the rise across all industries, the need for diligence remains vital.

  • Report suspected fraud. Look out for suspicious activity or unusual patterns and report them to SIU or Fraud Teams. Data analytics are important, but frontline teams are a key defense.
  • Stay connected. With limited face-to-face interactions to share ideas, be purposeful in discussing suspected/known fraud in virtual meetings and continue to attend events on fraud prevention to stay connected as an industry.
  • Remain diligent. Beware of pandemic-driven process “shortcuts”: personnel reductions, processing exceptions/adjustments, or newly established ways of doing business. Identify fraud red flags resulting from new work environments and share them broadly.
  • Validate customer information. While the pandemic required certain accommodations regarding documentation, verification remains essential. Out-of-the-norm requests from customers should be validated using alternate and proven contact points.

Six Steps to Insurance Claims Fraud Detection During the COVID-19 Pandemic

Karen Riendeau, Senior Technical Claims Consultant, U.S. Mortality Markets Operations

The hardest part of the past year, of course, was witnessing the tragic loss of life, and my heart goes out to all those who lost loved ones to COVID-19. As an insurance professional, I am proud of the role our industry played in helping provide financial security to all those families in their time of need. Unfortunately, fraudsters often see tragedy as opportunity. Overworked claims departments must continue to be sympathetic to all those claimants who have experienced a loss while also keeping a watchful eye out for opportunistic fraudsters. The six steps I outlined last year still apply today, especially validating the death certificate and confirming the cause of death. And the need to investigate contestable claims may be more important than ever. It helps to remember that, in the end, preventing claims fraud enables insurers to better protect the families who are counting on us.

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Meet the Authors & Experts

Mark S. Dion
Vice President, Underwriting Education and Training (ret.), U.S. Underwriting, U.S. Mortality Markets
Alan Hobbs
Alan Hobbs
Vice President Underwriting Services (ret.) 
Colin M. DeForge
Vice President, Underwriting, U.S. Underwriting, U.S. Individual Life
Bob Gooderl
Vice President, Administration Oversight
Alex Bunte
Executive Director, Assumed Administration Reporting and Deal Team, RGA
Karen Rideneau
Karen Riendeau
Senior Technical Claims Consultant, U.S. Individual Life Operations