Desktop Mapping Combats Insurance Fraud

by Lloyd Borrett
Postcode Boundaries Case Studies, AUSLIG, 1993

Insurance companies are constantly looking for ways to increase their effectiveness in the fight against fraudulent insurance claims. One tool now being increasingly employed because of its low cost, ease of use, and effectiveness is desktop mapping.

The following example uses a fictional natural disaster, insurance company and claim data, but this is a scenario being acted out by an increasing number of insurance companies and like-minded organisations faced with similar problems.

The Scenario

A devastating storm hits the northern suburbs of Sydney, and many millions of dollars worth of property damage is done by hailstones as large as golf balls. During the coming weeks hundreds of claims are received by the larger insurance companies.

The insurance fraud investigators in one of these insurance companies prepare to combat the possibility of fraudulent claims being lodged.

The Tools Selected

A desktop mapping package, Atlas MapMaker for Windows from Strategic Mapping, is chosen as an appropriate tool for the task.

The key to quickly locating property damage claims is the Postcode held on each property address.

Because only thematic maps are required the Minimal Postcode boundary product is selected.

The Microsoft Excel spreadsheet software package is selected to build a simple database of claim numbers and the Postcode of the property.

Methodology

As a claim is received the claim number and the Postcode of the property is added to a Microsoft Excel spreadsheet. See figure 1.

Figure 1 Microsoft Excel spreadsheet of insurance claims summary details

By the end of the second week after the storm, some two hundred claims have been received. A summary spreadsheet with the number of claims for each Postcode is then prepared in Microsoft Excel. Figure 2 shows this spreadsheet. Atlas MapMaker for Windows is then started, the Minimal Postcode boundaries loaded, and the Microsoft Excel spreadsheet linked.

Figure 2 Microsoft Excel spreadsheet of Postcode frequency from the insurance claims summary

The Result

Figure 3 shows the map that is then displayed on the screen. The claims in Postcode areas 2062, 2072 and 2094 look somewhat suspicious.

A quick lookup in the Microsoft Excel spreadsheet gives the claim numbers of the five claims in those Postcodes and the claims are targeted for further investigation.

A cheap, easy-to-use, desktop mapping package coupled with a widely used spreadsheet package and the Minimal Postcode boundary product can be used effectively by most office workers to solve similar problems, improve the effectiveness of resources and increase business profits.

Figure 3 Thematic map showing insurance claims for northern Sydney using the Minimal Postcode boundary file.