Combating Fraud in the Insurance Industry

Alumna Khrys Fisher is a senior claims service adjuster with Allstate.

Khrys Fisher (’95) always wanted to be an investigator. As a child, she would play detective. If something turned up missing in her home she would grab a camera and take photos of the “crime scene.”

Today, Fisher, a senior claim service adjuster, has turned her investigative instincts into a career at Allstate. She investigates potential fraud in auto, homeowners and casualty insurance claims. Last year Allstate’s Special Investigation Department filed 32 cases across the country with an estimated value totaling $51.6 million. With 14 cases so far in 2013, the unit has identified $18 million in fraudulent claims.

“I investigate a wide assortment of claims,” said Fisher, who specializes in casualty cases in Houston, which is part of Region 6, which covers a broad area from Texas to Montana. “We investigate claims when we suspect that something is not adding up. Sometimes the smallest details can lead to larger discoveries.”

An insurance adjuster take information for an auto accident claim.Allstate, a leading insurance company, employs more than 500 investigators nationwide. Their job is to flag suspicious activities, analyze questionable claims, and prevent fraudulent payouts. The FBI estimates that insurance fraud costs Americans $30 billion a year, and the National Insurance Crime Bureau (NICB) asserts that scams and inflated claims raise the average family’s auto insurance premiums by as much as $300 annually.

Fisher’s work involves claims of bodily injury and she often uncovers medical providers who bill for services not rendered and inflated medical claims for treatment. Sometimes the claims involve elaborate schemes and include teams comprised of attorneys, tow truck operators, body shops owners, and doctors that specifically seek out people willing to play the victim in order to file a false claim.

“There is never a dull moment, and nothing is ever mundane,” said Fisher. “There is always a new scheme, and there are always new providers willing to invent or inflate a claim.”

Damage to a car from an accident.To combat the problem, Texas legislature recently passed a bill prohibiting attorneys or medical providers from soliciting accident victims within 30 days of an event. The biggest challenge right now is finding those who are bypassing this law. Sometimes lawyers contact victims, claiming to be the insurance company, in order to extract information.

While law enforcement agencies, such as the FBI, the Department of Public Safety, the state Department of Insurance, and local District Attorneys, pursue criminal investigations in cases of insurance fraud, Fisher’s job is investigate claims when they are deemed necessary. While their roles may be different, Fisher uses many of the same techniques to get the job done. She spends most of her days doing interviews, scouring through medical reports, or surfing the web to dig up information.

Fischer also takes advantage of resources available through NICB, which is a partnership among 1,100 insurance companies, to include; vehicle rental companies, auto auctions, vehicle finance companies, self-insured organizations and strategic partners that share information to combat crime.

Image of a stethoscope resting on insurance papers.“Criminal justice is both an art and a science,” said Fisher, quoting an old t-shirt designed by Lambda Alpha Epsilon at Sam Houston State University. “It’s a package deal. You can’t just take the book work and learn the penal code. There is an art to interviewing as well. There is a technique in getting people to tell you things they normally wouldn’t tell you.”

“To be a good investigator, you need to have good interviewing and writing skills as well as an analytical mind,” Fisher said.
“You have to be willing to look at the evidence and analyze it objectively,” Fisher said. “You have to turn over every leaf, you have to turn over every rock, you have to shake every tree, and sometimes nothing falls out. You have to review what you find without a pre-conceived notion.”

Illustration of arson with a burning home giving off smoke dollar signs.Fisher said she uses lessons learned at Sam Houston State University, such as how to read body language, in her daily work. She urges students to take something away from every course, “because you never know when you might need it.” She also said that to be a fraud investigator, you need to be patient, because most investigations take a long time, and you need to be willing to travel.

“You have to have a willingness to be active because as a fraud investigator you don’t sit at a desk all day,” Fisher said. “Some days you might work 9 to 5 and some days you might be out in the field traveling to Beaumont or Edinburg. You have to be willing to be mobile, travel a bit, and do what you have to do to get the job done.”

Member of The Texas State University System