Scott McNealy, CEO of Sun Microsystems, once declared: “Privacy is dead – get over it.” Executives at some of the UK’s major insurance companies have taken those words to heart.
In recent months, about one-quarter of Admiral policyholders have withdrawn claims that their vehicle has been stolen. The insurance company attributes the fall to the rollout of lie detector software. It began testing Digilog’s voice risk analysis software in May and has extended the pilot. It found that about 20% of all motor claims are either exaggerated, fail to disclose material information, or are fraudulent.
Brownsword, the outsourcing company running the system for Admiral, says that policyholders who telephone are immediately told that the conversation is recorded and that information will be analysed. The claims handler asks general questions for a few minutes, such as the policyholders’ name and details, so the software can monitor the voice and identify normal stress levels. If any irregular levels occur, the handler calls back to give the policyholder a chance to withdraw the claim, even suggesting that they check again that the car has been stolen.
Admiral is the latest insurer to attempt to cut down on fraud through the use of lie detecting technology. Britain’s biggest mortgage lender, HBOS, uses similar software to evaluate the veracity of household insurance claims. So does Highway Insurance, which says the proportion of motor claims withdrawn since it began using the system 18 months ago has jumped from 5% to 18%, according to Insurance Times.