Fraud detection vital in captive management

The possibility of insurance fraud is an important consideration for any captive manager, delegates at the 2023 Bermuda Captive Conference have heard.

In a discussion panel entitled “CSI Captive - uncovering fraud with forensic claims analysis”, attendees heard that fraud remains a persistent and serious issue, with global fraud losses totalling $4.5 trillion.

The panel consisted of Janis Hagen Bucher, MD, Crawford, Gerry Bouwman, partner, MDD Forensic Accountants and Kyle Masters, partner, Carey Olsen, with Chris Wilkie, International Executive General Adjustor, also from Crawford, moderating.

According to the panel fraud can come from many places, including employees of a company - but that fraud committed by managers can be more substantial and damaging, because such staff know where the controls are and how to override these.

The panel stressed the need for robust and clear underwriting policies, the presence of whistleblowing mechanisms, proper internal controls and proper oversight and analytics.