Canadian Digital Fraudsters Are Increasingly Targeting Insurance Companies in the First Half of 2022

Toronto, Ontario, Sept. 22, 2022 (GLOBE NEWSWIRE) — According to a TransUnion Canadian research TruValidate, for the second quarter in a row, the number of suspected digital fraud cases worldwide in the insurance industry increased year-on-year, increasing 159% between Q2 2021 and Q2 2022 (+ 125% from Canada). This follows a 134% increase worldwide between Q1 2021 and Q1 2022 (+151% from Canada). Although the rise of fraud in the insurance industry is increasing, TransUnion (NYSE:TRU) quarterly fraud analysis observed that the number of digital fraud attempts worldwide decreased by approximately -14% between Q2 2021 and Q2 2022. Canadasuspected digital fraud attempts dropped -37% in the same period.

TransUnion observed a decrease in the number of suspected digital fraud attempts from Canada-from several industries including: sports (-66%), financial services (-52%), retail (-31%), communications (-13%), travel and entertainment (-6%) and transportation (-3 %).

On the other hand, the only industries beyond insurance that have experienced an increase in suspected attempts at digital fraud are from Canada year-on-year in Q2 2022 included areas such as online dating, forums, etc. (+10%) and gambling (+8%). However, the types of corruption in each of the three industries were quite different. First-party applicant fraud was the most advanced insurance fraud to affect the industry. This type of fraud involves the fraudulent use of information that contains intentionally incorrect or altered information provided by the owner for the purpose of obtaining certifications, lower prices or better policy/contract terms. While some communities were concerned with fake profiles, where users posted false information and/or used fake photos.

“In recent years, we’ve seen fraudsters change their businesses every quarter because they realize that businesses have put in more control measures. These fraudsters are like flies – they’re always changing,” he said. Patrick Boudreauhead of identity management and fraud strategies at TransUnion Canada. “We have seen a trend in the first half of 2022 where people suspect that fraud in the insurance industry is increasing in the first six months of the year. At this time, we believe that the insurance industry is seeing ‘soft fraud’ – meaning that the policyholder misrepresents information or other events in order to reduce the amount they pay. It may be that some consumers are misrepresenting their policies in an attempt to save money, especially in high inflation environments that put more pressure on their wallets.”

Digital fraud continues to permeate the lives of many Canadian consumers. The latest information about TransUnion Consumer Pulse The survey found that nearly 3 in 10 (31%) Canadian adults reported that they have tried digital fraud. And 7% committed fraud such as fraud, theft or other forms of fraud.

Digital Fraud Trials Considered Transferring to New Industries Globally Against Canada

Companies Canadian Price Changes from Q2 2021 to Q2 2022 Global Price Changes from Q2 2021 to Q2 2022
Insurance +125% +159%
Communities (online dating, forums, etc.) + 10% -8%
Gambling +8% -14%
Driving style -3% + 13%
Travel & Entertainment -6% -28%
Telephones -13% -12%
That’s it -31% -28%
Financial Services -52% -22%
Sports -66% -63%

“The digital boom brought about by this pandemic has spilled over into industries that used to operate online, which fraudsters are trying to take advantage of,” Boudreau said. “At the same time, companies that are finding that fraud is becoming more common, the focus has shifted to identifying the “good” that has happened and helping them not to die with less conflict. For many industries and businesses, it is difficult to plan to implement security measures to help eliminate potential fraud – without creating conflicts for customers their real ones. Strong fraud and verification systems can reduce the quality of false claims and focus anti-fraud tools on the few that need to be evaluated. By reducing manual checks and customer inquiries, organizations can reduce costs, increase revenue and improve the customer experience.”

About the Study
TransUnion arrived at its anti-fraud insights for businesses by drawing on intelligence from billions of websites and over 40,000 apps in its proven, risk-based authentication and anti-fraud solutions – TransUnion TruValidate. The percentage or number of suspected digital fraud attempts and those that TruValidate customers rejected or evaluated for fraud indicators compared to all transactions that were evaluated as fraud.

With global and regional disruptions around how many suspected digital frauds have changed recently, what types of fraud are prevalent in certain industries and more, please download the infographic.

About TransUnion (NYSE: TRU)
TransUnion is a global information and knowledge company that builds trust in today’s economy. We do this by providing a realistic picture of each person so that they can be reliably represented in the market. As a result, businesses and consumers can act with confidence and achieve great things. We call this Good Knowledge.® TransUnion provides solutions that help create economic opportunities, positive experiences and empower hundreds of millions of people in more than 30 countries. Canada includes some of the country’s largest banks and card issuers, and TransUnion is a leading provider of credit reporting, fraud, and analytics solutions across the financial, retail, telecommunications, utilities, government and insurance sectors.

Contact Emma Tiessen
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Phone 647-523-1594

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Source: TransUnion