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May 11, 2012

Santam Saves $2.4 Million in Fraudulent Claims by Using IBM Analytics Software

By Sujata Garud, TMCnet Contributor

IBM (News - Alert) business analytics software exceptionally facilitates organization to apply analytics to decision-making, anytime, anywhere. Studies have revealed that organizations that apply analytics always perform better than their competitors. A very good example is Santams recent experience, which saved $2.4 million on fraudulent claims in the first four months of using IBM business analytics software.

Santam, South Africa's leading short term insurance company, also enhanced fraud detection capabilities with the use of IBM’s business analytics software. For insurance companies, the speed of claims handling is an important factor. Before using IBM analytics, Santam took a minimum of three days to settle claims. Whereas, now Santam is in a state to settle legitimate claims within an hour, allowing the insurer to significantly improve customer service.

IBM's predictive analytics software helped Santam to automatically evaluate if there is any fraud risk related to the incoming claims. Accordingly, the insurer was allowed to distribute claims to the appropriate processing channel for immediate settlement or further investigation, which optimizes operational efficiency. Deployment of IBM Analytics software helped Santam to save enough of an amount as it reduced the number of claims that required an assessment by mobile operatives visiting the customer or claim site.

Anesh Govender, head of finance, reporting and salvage at Santam, said, “IBM and OLRAC-SPSolutions have helped us build a solution that has not only transformed our claims processing methodology in terms of speed and efficiency, but also provides new insight which helps us identify false claims more quickly, which protects our business and customers. The solution has delivered a full return on investment and also helped uncover a motor insurance fraud syndicate in less than 30 days after the system went live.”

Recently, IBM was in news when Misys signed a software licensing deal with IBM to help banks optimize business process. The software licensing agreement incorporates IBM business analytics, information management and application server software.

Edited by Brooke Neuman

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