GOA, May 2022 – The Indian government lost around Rs. 1,200 crores in taxes because of motor vehicle insurance frauds during the financial year ended March 2022, Bajaj Allianz General Insurance Head of Department – Investigation & Loss Mitigation Mr. Sanjiv Dwivedi said today.
Speaking at the ‘Kshitij’ Goa Seminar, organized by Association of Investigators and Detectives (AID), Mr. Dwivedi noted post COVID19, the number of fraud cases in general has increased phenomenally. Quoting a global report, he said the number of fraud cases in 2020 alone was Rs. 22,258 crores and is set to increase at a CAGR of 22.8% to Rs. 94,968 crores between 2020 and 2027.
He pointed out that the cases of fraud in the insurance sector, especially motor vehicles, was alarming. Although only 0.5% of insurance cases are investigated, it results in value savings of approximately Rs. 250 crores, which is an impact on loss ratio of around 4%-4.5%.
“This is just the tip of the iceberg,” Mr. Dwivedi said. “Cases of frauds are usually in the form of exaggeration of compensation – inflation of disability, income, medical expenses and age multiplier”.
Stressing on the role of private investigators in investigations, AID Founder Director Mr. Surendra V. Jagga said it was time for the government to recognize and acknowledge their importance in the investigation process, as any loss is not just of insurance companies but of the government as well.
“Only certified and trained investigators should be recruited by insurance companies for standardization in the sector. If we follow this practice, the current impact on loss ratio of 4%-4.5% ratio would increase to 7% soon,” Mr. Jagga said.
The two-day seminar was attended by over 45 investigators from across India. The gathering discussed various aspects of investigations and fraud, including cyber frauds, use of gadgets in field investigations, marine cargo recovery, and use of forensics in fire loss.
Independent cyber crime investigator and certified ethical hacker, Sachin Dedhia, reckoned that the dark net is emerging as one of the more useful platforms for investigators to offer their services to clients worldwide. Besides, the use of mobile spy applications has become quite common, with varied groups of people, including partners, employers, and parents installing such software to track activities.
Mr. Dedhia said: “Given the rise in cases of cyber frauds and breaches, the next big market opportunity for investigators is in the cyber insurance space, which is being increasingly used by businesses globally to insure themselves against data breaches”.
With Mr. Jagga, Mr. Tushar Vishwakarma, and Mr. Ashish Desai as founder directors, AID is an umbrella body of practicing private investigators that works towards skill development of professionals and integration of the community.