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Insurers eye biometric cards to counter frauds
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Insurers eye biometric cards to counter frauds
To counter rising frauds in health insurance, insuran-ce companies are considering use of biometric cards for identification of insured members.
Some insurers such as ICICI Lombard and HDFC Ergo General Insurance have already begun using biometric cards for the government-sponsored Rash-triya Swasthya Bima Yo-zana (RSBY) meant for below poverty line (BPL) population. Now, Iffco Tokio General Insurance, Future Generali General Insurance and Royal Sundaram Insurance are trying to implement the same for all categories of clients.
A biometric card contains a smart chip, which carries personal details and a photograph of the policyholder. These cards authorise transactions based on the customers’ fingerprints.
“Insurers are slowly moving towards implementing biometric cards. Earlier ide-ntification cards provided by insurers carried only basic details such as name and age. Then, some insurers st-arted issuing identification cards alo-ng with photographs of the insured, but frauds are still rampant. Bi-ometric cards will help tackle frauds,” said N K Kedia, director of marketing at Iffco Tokio General Insurance.
The cost of making biometric cards comes to
Rs 110.
Fraud in health insura-nce causes massive losses to insurers. A recent survey by IndiaForensic Research, a Pune-based consultancy, showed the insurance industry was losing around Rs 15,000 crore a year due to fraudulent claims on health and motor portfolios.
“Increased incidence of frauds will lead to an unnatural spurt in health claims, which will make it economically unviable for an insurer. This, in turn, will lead to an increase in premium and ultimately genuine custo-mers will end up paying a high price for insurance,” said Ajay Bimbhet, managing director of Royal Sundaram Alliance Insurance.
Impersonation – another person getting hospitalised and claiming benefit in the name of insured — is a co-mmon fraud being encountered by health insurers.
Insurance firms have be-en taking steps to tackle fr-auds by sharing data on fr-audulent intermediaries/h-ospitals among various the-mselves and by making surprise visits to check whether the patient is admitted to a hospital as informed.
Biometric cards, too, have their own set of problems. Krishnamoorthy Rao, COO of Future Generali India Insurance, said, “Biometric cards will be helpful to some extent ub verifying the client. However, all service providers (hospitals) at present do not have facilities to verify such cards. At present, Future Generali is not using this. In future, we will introduce the same depending on how many service providers have facilities to read such cards.”
“We are not using biometric cards as of today, but there is a plan to do so in select schemes mainly in those which are associated with the government,” added Ajay Bimbhet.
Public sector insurer Oriental Insurance is yet to move towards biometric ca-rds. “There is a cost involved in issuing biometric cards, which has to be taken into consideration,” M Ramadoss, chairman and ma-naging director of Oriental Insurance, told Financial Chronicle.
The health insurance industry in India has been growing at 30 per cent every year. The total health premium collected during 20-08-09 was Rs 6,090 crore compared with Rs 4,960 crore collected in 2007-08.
Source:
http://www.mydigitalfc.com/insurance/insurers-eye-biometric-cards-counter-frauds
Some insurers such as ICICI Lombard and HDFC Ergo General Insurance have already begun using biometric cards for the government-sponsored Rash-triya Swasthya Bima Yo-zana (RSBY) meant for below poverty line (BPL) population. Now, Iffco Tokio General Insurance, Future Generali General Insurance and Royal Sundaram Insurance are trying to implement the same for all categories of clients.
A biometric card contains a smart chip, which carries personal details and a photograph of the policyholder. These cards authorise transactions based on the customers’ fingerprints.
“Insurers are slowly moving towards implementing biometric cards. Earlier ide-ntification cards provided by insurers carried only basic details such as name and age. Then, some insurers st-arted issuing identification cards alo-ng with photographs of the insured, but frauds are still rampant. Bi-ometric cards will help tackle frauds,” said N K Kedia, director of marketing at Iffco Tokio General Insurance.
The cost of making biometric cards comes to
Rs 110.
Fraud in health insura-nce causes massive losses to insurers. A recent survey by IndiaForensic Research, a Pune-based consultancy, showed the insurance industry was losing around Rs 15,000 crore a year due to fraudulent claims on health and motor portfolios.
“Increased incidence of frauds will lead to an unnatural spurt in health claims, which will make it economically unviable for an insurer. This, in turn, will lead to an increase in premium and ultimately genuine custo-mers will end up paying a high price for insurance,” said Ajay Bimbhet, managing director of Royal Sundaram Alliance Insurance.
Impersonation – another person getting hospitalised and claiming benefit in the name of insured — is a co-mmon fraud being encountered by health insurers.
Insurance firms have be-en taking steps to tackle fr-auds by sharing data on fr-audulent intermediaries/h-ospitals among various the-mselves and by making surprise visits to check whether the patient is admitted to a hospital as informed.
Biometric cards, too, have their own set of problems. Krishnamoorthy Rao, COO of Future Generali India Insurance, said, “Biometric cards will be helpful to some extent ub verifying the client. However, all service providers (hospitals) at present do not have facilities to verify such cards. At present, Future Generali is not using this. In future, we will introduce the same depending on how many service providers have facilities to read such cards.”
“We are not using biometric cards as of today, but there is a plan to do so in select schemes mainly in those which are associated with the government,” added Ajay Bimbhet.
Public sector insurer Oriental Insurance is yet to move towards biometric ca-rds. “There is a cost involved in issuing biometric cards, which has to be taken into consideration,” M Ramadoss, chairman and ma-naging director of Oriental Insurance, told Financial Chronicle.
The health insurance industry in India has been growing at 30 per cent every year. The total health premium collected during 20-08-09 was Rs 6,090 crore compared with Rs 4,960 crore collected in 2007-08.
Source:
http://www.mydigitalfc.com/insurance/insurers-eye-biometric-cards-counter-frauds
