Texas Mutual explains open strategy on fraud busting
Compiled by Insurance24
HARARE, Texas Mutual Insurance Company is well and truly clamping down on insurance fraud. In 2017, the insurer’s internal fraud department identified more than $6 million in workers’ compensation fraud and made a number of convictions.
The fraud busters have remained hard at work through the first half of 2018, publicly announcing multiple sentencings. But why is Texas’s largest workers’ compensation insurer so open about getting scammed?
“We really believe that the more we can talk about our anti-fraud efforts, the more likely it will serve as a deterrent for people who might be thinking about committing fraud. We’re proud to be open and honest about our commitment to stopping workers’ compensation fraud,” said Jeremiah Bentley, vice president of marketing and customer engagement at Texas Mutual.
“We know that customers who buy workers’ compensation insurance from us really value our fraud prevention efforts. We believe we put more resources into it than anyone else here in Texas and we’re getting some great results for our policyholders. Our openness also helps to educate the public about workers’ compensation fraud and raise awareness about the impacts fraud can have.”
Texas Mutual has three specific fraud investigation teams, looking primarily at claimant fraud, healthcare fraud and premium fraud. Claimant fraud is by far the most frequent type of fraud in terms of number of incidents, but healthcare and premium fraud tend to pack a harder financial punch. Over time, the insurer’s fraud teams have become more specialized, and with the help of technology, are identifying more and more incidents every year.
Claimant fraud involves more traditional surveillance work, searching for red flags that indicate an individual is trying to cheat the system. An example might involve an employee who says they’re too injured to work but then posts pictures of themselves on Facebook riding the rodeo at the local show. In this case, social media is the fraudster’s worst enemy and the insurer’s best friend.
“The claimant fraud unit has a real opportunity to do universal surveillance and virtual research from their desks and their computers. As we develop more sophisticated analysis tools and software, I think we will be able to more accurately pin-point actions that seem outside of normal practice and then take an extra look at them,” Bentley told Insurance Business.
“Technology is also enabling the fight against fraud on the healthcare billings and premium fraud side of things. We can now carry out a lot of analysis on billing patterns and, with computer power, we have the ability to really dig into that data. For example, we’ve had incidents where healthcare providers have billed more hours than there are in a day, and technology enables us to detect something like that much quicker.”
Brokers and agents can also help in the fight against workers’ compensation fraud, according to Bentley. They can keep an eye out for red flags, and educate clients about the real impacts of workers’ compensation fraud. Perhaps they can also take a leaf out of Texas Mutual’s book in being transparent and open about the issue.
“More money or less money”: Keeping producers accountable to achieve higher growth
HARARE, Bringing new business in the door regularly is what separates high growth agencies from average performers, according to MarshBerry’s 2018 Organic Growth Check-Up. Agencies should aim for a low leakage rate, or the impact that rates have on the current books, which MarshBerry recommends they can offset with more intentionality around the sales process.
There are many ways to lose revenue from existing accounts – a client goes out of business, shuts down locations, terminates employees, or is susceptible to market downturns in their industry, among others – that, in combination with swings in P&C rates, can have a negative impact on an agency, explained Nick Kormos, vice president of organic growth solutions at MarshBerry who has already divulged key recruiting and training strategies agencies can implement on their way to high growth performance.
“All those things are outside of the control of the broker. The only thing they control is the level of service,” he said, adding that many agencies are likely not losing business because of their product offerings or customer service.
To reach an organic growth rate of 19.5% and match top performers in the industry, agencies can improve producer accountability by making sure that everyone in the organization has goals to hit and incentives to reach those goals as well as clear consequences when targets aren’t met.
“Whenever I’m working with an organization, I really have to try to gauge what is their willingness to hold people accountable and what accountability really means,” said Kormos. “What are they willing to do if people don’t meet that expectation going forward? Are they willing to change the way that they do business to enable those people to go out and sell new business, because sometimes it’s not the salespeople’s fault – it’s the infrastructure that doesn’t allow them enough time to have a book and grow it at the same time.”
There are a lot of different things that motivate people besides money – recognition, self-worth, competition, and team building. However, at the end of the day, when all else has failed to change behavior, there are only two things left: more money or less money, according to Kormos, which will be the very definition of producer accountability in your firm.
“Without a negative consequence for failing to meet expectations, you are virtually powerless against complacency,” he said.
Defining each producer’s role in the sale can likewise help agencies attain new business. Some people are good at opening doors to new accounts, others excel at qualifying accounts, and some employees are great closers. Not everyone has all three skills, and MarshBerry is seeing forward-thinking organizations place people in different roles within that sales process to take advantage of producers’ unique talents.
With technology already transforming agencies, these solutions are also important partners in achieving higher growth rates.
“Technology is integrated in the ability to prospect and to get more information about your prospective customers,” said Kormos, listing LinkedIn and pipeline managers as examples of platforms that allow agents to aggregate information about potential clients so they’re better informed about their needs, which makes the sales process easier, as do investments in technology that enhance an agency’s value proposition.
“If you have a process that you can use to take prospects through the sale and it’s built into a technology platform so that you can always understand where they are in the process, and what the status is and where things are going to go next, it makes the sales process so much more efficient and everyone understands where you stand.”
Agencies can then add perks like 24/7 service via an online platform or data and analytics tools that can differentiate them from competitors.
“If you can help people make better decisions and see better results, they’re going to be that much more engrained into the partnership with your firm,” said Kormos.
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