The Canadian Life and Health Insurance Association is launching an industry initiative to pool claims data and use advanced artificial intelligence tools to enhance the detection and investigation of benefits fraud.
While all Canadian insurance companies have their own internal analytics to detect fraud within their book of business, the new initiative — led by the CLHIA and its technology provider Shift Technology — will deploy advanced AI to analyze industry-wide anonymized claims data. It will aim to identify patterns across millions of records, enhancing the effectiveness of benefits fraud investigations.
In a press release, the CLHIA said it expects the initiative will expand in scope over the coming years to include even more industry data. “Fraudsters are taking increasingly sophisticated steps to avoid detection,” said Stephen Frank, the organization’s president and chief executive officer. “This technology will give insurers the edge they need to identify patterns and connect the dots across a huge pool of claims data over time, leading to more investigations and prosecutions.”
According to the CLHIA’s annual fact book, Canadian insurers paid out nearly $27 billion in supplementary health claims in 2020. It estimates that employers and insurers lose millions of dollars each year to fraudulent group health benefits claims, which puts the sustainability of group benefits plans at risk.