Using IBM Analytics, Santam Saves $2.4 Million in Fraudulent Claims
The analytics software has enhanced Santam’s fraud detection capabilities and also enabled faster payouts for legitimate claims.
"IBM and OLRAC-SPSolutions have helped us build a solution that has not only transformed our claims processing methodology in terms of speed and efficiency, but also provides new insight which helps us identify false claims more quickly, which protects our business and customers," said Anesh Govender, Head of Finance, Reporting and Salvage at Santam. "The solution has delivered a full return on investment and also helped uncover a motor insurance fraud syndicate in less than 30 days after the system went live.”
The claims division developed a new operating model for processing claims, depending on varying risk levels. IBM's predictive analytics software has enabled Santam to automatically assess if there is any fraud risk associated with incoming claims and allows the insurer to distribute claims to the appropriate processing channel for immediate settlement or further investigation, which optimizes operational efficiency.
With the enhanced claims segmentation, Santam is also able to reduce the number of claims that need to be assessed by mobile operatives visiting the customer or claim site, resulting in further considerable cost savings for the company.
Speed of claims handling is an important differentiator for the company. Before using IBM analytics, it took at least three days to settle claims. Now, Santam is able to settle legitimate claims within an hour allowing the insurer to significantly improve customer service.
"IBM is investing in building business analytics solutions that help organizations to effectively mitigate risk," said Rich Holada, vice president of predictive analytics at IBM. "Santam provides an excellent example of how insurers can put analytics into action in order to reduce fraud and risk, while improving the customer experience by settling claims faster and keeping premiums low."