Who you gonna call?

The insurance industry is itself continuously seeking about innovation – innovative technology, innovative fintechs, innovative products… But most insurance companies are not paying enough attention to the more nefarious innovation taking place behind closed doors in South Africa every day.

In June 2017, the former SAICB (South African Insurance Crime Bureau) announced at a CEOs Breakfast that it was evolving – they are now "The Insurance Crime Bureau", a name change representing a tactical shift in the organisation to align themselves with the life side of the insurance industry for the first time. 

"Around three years ago the SAICB board decided to venture in to the Life Insurance space, as we saw that there were serious incidents of fraud and crime in this industry. We decided to target Life Insurance companies to join the SAICB in our fight against crime. To achieve this, we dedicated one of our short term insurance investigators / project managers, Johan Steyn, and since 2014 he’s been project managing life insurance fraud projects. Based on the success experienced in this area we decided, at our strategic session in March 2017, that Life will now officially be one of our focussed growth points, one of our top five strategic objectives for the year. The fact is that we have shown we are doing very well in the fight against fraud and physical crimes," said Hugo van Zyl, COO of the bureau. According to the gentlemen at The Insurance Crime Bureau, even the savviest of players in the long-term insurance game have no idea of the scale and seriousness of fraud being committed within their backyards and need more focussed assistance in combatting it. "Insurance companies do not fully understand the quantum of the challenge in the life insurance industry," said van Zyl.

Johan Steyn, a member of the Insurance Crime Bureau who has been personally involved in many high-stakes cases, agreed. "When we started three years ago I had no idea of the scale of the problem. Now it’s getting worse. I am involved in ten ongoing "Murder for Money" cases right now, and I’ve assisted with around 150-200 cases on the life side alone, in the three years I’ve been working it, having been combatting short term insurance fraud before that."

"It’s definitely getting worse. In the old days, it was falsified documents and they would buy a body from a morgue. But these days they take out a policy, in your name, and then they murder you." It’s more sophisticated, more direct, and, for the average policyholder, much more lethal.

"There have been a lot of drownings now," said Steyn, "where they are cutting off the victims hands, so you can’t get fingerprints. It used to be motor vehicle accidents. They also going into the shabeens saying 'give me your ID book I will get you a job', after first policy premium, they spike his drink, and stage a hit and run. People are doing new things, the criminals are innovating."

Even more worrying, van Zyl warned the public of a likely spike in insurance-related violent crimes in the near future.

"I spoke at GIBS on this a couple of weeks ago," said van Zyl. "It’s just getting more and more and more, and with this recession of ours now I can tell you we’re going to have a spike of fraud in both the industries – life and short term cases." 

The good news is that it is clear that fraud is an industry challenge and at present the Short Term industry is experiencing massive success, the time is now for the other side of the fence to join in these wins. "We have shown direct savings in the life environment in excess of R100 million in the last three years, on the short term side we’ve done in excess of R250 million for members alone," confirmed de Klerk. 

It’s an impressive set of figures to arrive at before reaching their tenth birthday, and The Insurance Crime Bureau hopes that at this time next year, after their first decade in existence, there will be even more to celebrate.

"A year from now on 1 July 2018, 10 years into the journey, we would like to see ourselves firmly entrenched as a solution provider to the life insurance industry," said de Klerk. "We currently have 4 life members – within our 4 life participants there are members of 'the big 6', and we are close to signing another 4-6 members. We would like to double that number by June 2018, and we feel that it’s doable. The process is now simply convincing the life players to join in the successes that the short term insurance industry is enjoying. The numbers are there."

For van Zyl, he wants more criminals convicted and jailed by this time next year. "There must be convictions, as without convictions there’s no incentive to stop criminal behaviour."

No more Mr. Nice Guy.