With small businesses adversely impacted by Covid-19 and the economic downturn, SME insurers need to be on their guard as the challenges faced by businesses can multiply into losses for them.
When cash is tight shortcuts are taken and the necessary precautions around Health and Safety that in normal times would be adhered to, can sometimes be the victim. This will lead to a rise in claims across multiple lines of business from material damage and business interruption to employers’ and public liability. As policies renew, the previously safe stable business the insurer may have a long history with may present an entirely different risk.
The risks are summed up by Craig Beattie of Celent who states, “Any recession or financial difficulty can result in an increase in opportunistic claims fraud, both small and large. The present dissatisfaction with the insurance industry from small businesses in the UK over the handling of business interruption covers, during the pandemic, and an emerging recession could cause a perfect storm for fraud.”
This content sheds light on insurance fraud trends during previous crises, the factors driving SME fraud during the current crisis and why now is the time for insurers to invest in solutions that could save them from paying out fraudulent (fire) claims in the post-Covid period.
• How safe stables might become high risks.
• SME fraud through the lens of the fraud triangle.
• Covid claims and investigations volumes.
• Start prevention today to be safe tomorrow.