SIUs – Perception & Reality
With new state mandated compliance regulations, Special Investigative Units (SIUs) are utilized to fight and expose fraud — whether it be internally or to partner with an external source..
But SIUs are not what many company managers have been lead to believe. In the past, executives viewed SIUs as business liabilities that did little more than handle and review files. Business owners and management were reluctant to use SIUs, because it is the job of an SIU to discover and bring in customers who are committing fraud. Or, in the case of an employee, the threat of a possible retaliation lawsuit. This has to be done precisely and with discretion, thus business owners were previously hesitant to turn the job over to anyone other than a company representative.
The good news is that SIUs are not the liabilities that they have been seen as in the past. In fact, the real value of SIUs has come to light in the industry and they are being used by increasingly more companies to handle claims investigations. SIUs are now essential to fraud claim handling, both from a cost savings and educational standpoint. Companies that want to be successful and profitable should start using SIUs as part of their regular business operations.
SIUs Save Insurers Money
There are good reasons for bringing on SIUs. The Insurance Information Institute approximates that most insurers save ten dollars for every dollar they spend using SIUs to combat fraud. The International Association of Special Investigative Units (IASIU) estimate those same figures. SIUs also help insurers by preventing fraud, such as identifying and denying people who file fraudulent claim after fraudulent claim, and by putting practices into place to discourage fraud before it begins..
SIUs are also helpful in identifying malingering by a claimant. These cases often start out as a legitimate injury, but due to financial incentives, the claimants make up or exaggerate symptoms beyond what is reasonable for additional compensation. Cases involving malingering can be highly costly to the insurer, and often require a detailed investigation to identify.
Additionally, SIUs let the public know that even the legitimate portions of the claim may be denied if they are not truthful on any portion of their claim, and thus provide an incentive for everyone to be honest on their claims, and on every part of them. In addition, SIUs can educate the public on fraud and what is right and wrong when filing insurance claims. So, in reality, SIUs save insurers much more money than the professional organizations estimate, because there are so many intangible benefits to using them. One of these benefits is the future money SIUs can save insurers through a variety of means.
What SIUs Can Do in an Investigation
SIUs are unique entities when it comes to what they can do in an investigation. They can compel people who have filed claims to cooperate in the investigation of the claim by explaining to them the investigation is a necessary and legal part of them resolving the claim and receiving any money from it. Those who have nothing to hide will have no problem complying with a claim investigation; those who have been fraudulent on part or all of it are usually less likely to want to be cooperative in those investigations. After all, if someone is asking for money in an insurance claim, they are legally, and quite reasonably, required to cooperate in giving the insurer the information necessary to prove the merits of the claim.
SIUs are entities of public and internal education so insurers can be sure they are complying with all state mandated regulations. They are thorough investigators that use every tool at their disposal to discover fraud and root it out, and bring legitimate claims the full attention and compensation they deserve. When used properly, SIUs are valuable assets and even public relations tools to insurance companies. SIUs do the following things for the insurers for whom they work:
- Fight fraud
- Defend the money of policyholders
- Handle regulatory compliance for insurers
- Promote social values of right and wrong in regards to filing truthful claims
- Save insurers money, time, and effort in proving the merit of a claim
- Protect the public relations image of insurers
Understanding the Value of SIUs
SIUs are getting recognized more and more in the insurance industry. While not being utilized to its full extent, this is changing as the perception of SIUs by insurers changes. Insurers on the cutting edge of progress are already using SIUs. These are the insurers who understand their value, worth, and proper use to the company. In light of state mandates and compliance, the insurers who use SIUs in their full capacity, not just as task oriented investigators, also understand the monetary implications of fraud, and are eager to do all they can to prevent it while still protecting their business and presenting a good image to the public.
Is it worth the cost to utilize SIU services? Absolutely. The alternative is to pay all claims without investigation, question or complaint, which may lead to raising premiums for all the other policyholders to make up for the lost revenue. This only encourages more people to file fraudulent claims.
When it comes to profitably managing an insurance company, it really does pay to hire an SIU and give them the freedom to do what they need to do to make sure all claims are genuine.
If you would like to learn more about your SIU options, please contact the Brumell Group today. We offer comprehensive SIU services to businesses, including investigations and fraud consulting. Protect your business by partnering with the Brumell Group for all your SIU needs. Call us today at (904) 880-5150 to get started.