Course description

Managing Financial Crime & Fraud in the Insurance Sector – The Three Emerging Trends

Insurance fraud is not a victimless crime and affects everyone in the UK. The UK Association of British Insurers estimates that fraud adds, on average, an extra £50 to the annual insurance bill for every UK policyholder. According to ABI figures, in 2019 insurers uncovered 130,000 fraudulent claims worth £1.32 billion. It is estimated a further £1.3 billion goes undetected. Therefore, tackling financial crime in insurance remains an industry strategic priority.

Evidence from recent studies carried out by insurers suggests that insurance fraud funds and facilitates other serious crime, including drug trafficking, money laundering and modern day slavery. Financial crime remains firmly on the legal and regulatory agenda. The annual money laundering test is no longer enough - Firms and individuals must know how to protect clients and themselves.

Insurance fraud has a significant negative impact on the industry and the risks are evolving, technology is advancing at a rapid pace, and regulators are starting to show interest in applying more scrutiny on insurers’ risk management frameworks. In this context, how can insurers be confident that they are effectively and efficiently managing their fraud and financial crime risks?

This course is designed to provide practitioners within the Insurance market with the tools and controls to manage fraud risk more successfully, mitigate the risk through best practice and implement a robust internal framework. The course provides a comprehensive understanding of fraud threats, how to formulate an effective strategy to prevent these threats and how to manage the response when they occur. You will learn how to implement key fraud management strategies at your firm to manage the risk to your business.

The course also explores international fraud management best practice and anti-fraud frameworks. This course outlines the threat to financial crime and its consequences for the insurance industry and the key anti-financial crime controls that firms should have in place. The FCA and BIBA require insurers to be able to demonstrate robust policies and procedures that comply with regulatory expectations and training to all staff.

Suitability - Who should attend?

  • Fraud Prevention and Investigation officers
  • MLRO – SMF17
  • CEO’s
  • CFO’s
  • Chairman – SMF9
  • Executive Director – SMF3
  • SMF18
  • Employees with responsibility for internal organisational fraud
  • Internal Audit and Regulatory Staff

Outcome / Qualification etc.

Learning outcomes:

  • Understand the exposure and consequences of financial crime for the insurance industry
  • Managing and investing in a fit-for-purpose fraud and financial crime risk management framework
  • Learn how to implement a robust IT Framework. Firms have more access to rich data than ever before, however, they should take care to ensure that the most useful inputs are included in their data models. If they don’t, preventive and detective technology solutions will be less effective.
  • Identify the main types of financial crime and their characteristics
  • Describe the key and evolving legislation to counter financial crime and the penalties for non-compliance
  • Understand the regulatory priority given to financial crime and what the FCA expects of firms and individuals
  • Describe the roles of the main agencies in combating financial crime, including those within industry
  • Recognise suspicious transactions
  • Outline the key but proportionate anti-financial crime controls that a firm should have in place

Training Course Content

This course will cover:

  • Challenging complacency – insurance industry exposure and the financial and reputational impact
  • Money Laundering, fraud, including insurance fraud, identity and data theft, sanctions, terrorism, corruption and bribery
  • UK and international legislation, and penalties. Bribery Act 2010 in detail
  • The FCA’s approach to financial crime and its guidance.
  • The agencies and particular industry initiatives
  • Identifying and reporting suspicious transactions and indicators, including Politically

Exposed Persons

  • Following risk based procedures, deterrence, prevention and detection

Day 1

  • Understand consumer fraud
  • Asset Misappropriation
  • Business Misconduct
  • Cyber crime
  • Bribery & corruption
  • Accounting fraud
  • Procurement fraud
  • Money laundering
  • International context
  • Global anti-fraud frameworks
  • Understanding risks
  • The 'Fraudster'. It is prudent for firms to refresh their understanding of known schemes and related risks for the purposes of enhancing their prevention and detection efforts.
  • Formulating an effective counter-fraud strategy
  • Case Studies and Breakout sessions.

Day 2

  • Managing the response to fraud. In the 2018 survey, 62% of respondents from the global Insurance community reported that their firms had been exposed to fraud and/or financial crime in the last 24 months. This marks a significant increase from previous surveys – the figure in 2016 was 37%, and for 2014 it was 35%.
  • Fragmented technologies and business processes

Another long-term trend that makes it hard to fight increasing financial crime is a fragmented business and technical approach. Anti-financial crime efforts in the industry are addressed by different teams with multiple processes, teams and tools – that all deliver similar capabilities. Rather than buy comparable capabilities over and over in separate tools, insurers are looking for more integrated ways to fight all types of financial crime. They want to resolve problems of incompatible, duplicated or stand-alone technologies. They need a complete picture of metrics but the data may live in separate silos. For such issues, advanced technology like AI and predictive analytics help. But technology alone is not a silver bullet.

  • Optimize people, process and technology to fight complex threats

Yet another trend is an emerging holistic approach against financial crime. It includes a common set of leading industry practices such as a financial crimes policy and common language, organization, skills, core processes and key performance indicators. These transformative methods can be summarized by three ideas: People (skills and roles), processes (procedures and policies) and technology.

Addressing people, processes and technology together is more effective than piecemeal efforts. It takes into account the fragmented resource picture, funding issues and the increasingly complex financial crimes landscape.

  • Investments in IT and Systems. Investigation and financial crimes units are often underfunded. So how do insurers keep up with aggressive approaches and technologies that financial criminals quickly rollout?
  • Case Studies and Breakout sessions.

About provider

FourthLine Learning

With over ten years experience helping organisations to build high performing risk and compliance teams, FourthLine Learning was launched to help risk professionals and teams to improve performance, navigate market complexities and make critical decisions more effectively. Our FourthLine Learning...

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Contact info

FourthLine Learning

60 Fountain Street
M2 2FE Manchester

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