Is Social Media An Acceptable Resource For Assessing Liability Risk In Life Insurance?
I once read a funny story where a life insurance company was trying to deny someone’s disability claim under the LTD portion of their policy. Their evidence in their denial? The person claimed they couldn’t work because they were depressed and the company found pictures from Facebook which showed the person smiling. As you can probably guess, the judge threw out their case. There’s a lesson there that insurance companies can use. While social media can be a good resource for uncovering fraudulent cases, it only works if you use it right.
Those who work in investigating claims and premium fraud in life insurance may find social media to be a particularly valuable tool, as it allows you to assess individuals on a personal level. On the other hand, it can also blur the line between an investigation and an invasion of privacy. If you’re planning to use social media as part of your insurance vetting process, then you need to make sure you’re taking a consistent, measured approach.
To Use or Not to Use Social Media Evidence
Social media can serve a function in insurance investigations but it can also be overused. Alone, it’s not something that’s going to prove or disprove a case. So while it may be useful in some investigations, it rarely acts as a magic bullet. That’s especially true if you’re not using it to gather the right information.
Before you use social media as evidence for denying an insurance application, you need to ask the following three questions:
- Is the account verified? Before you can use evidence gathered from a social media source, you need to be able to prove that this is actually the person in question. Even if someone has a very unusual name, it’s a big world and there are billions of accounts on social media. People with the same name and age range may come up when you search that person. Someone may have even created an account under someone else’s name. Use photos, emails, and other person-specific information to verify that the account belongs to the person you’re investigating.
- Is the information relevant? To be relevant, the evidence must prove that the person got something they shouldn’t by misrepresenting themselves. If someone says that they don’t engage in any high-risk activities and receives low-risk policy rates, and then posts photos of themselves skydiving, scuba diving or rock climbing, that’s relevant. Their premium would have been higher if they’d been honest about those activities. On the other hand, if someone claims they live alone and social media shows they have a live-in partner, that’s not relevant. Their life insurance premium wouldn’t have been higher if you’d had that information at the outset—it may even have been lower.
- Does it prove a solid point or require conjecture? The evidence must be clear and obvious, in that anyone who looks at it will come to the exact same conclusion. For that, we can look at the case of the woman with depression and the “evidence” the insurance company found of her smiling. Assuming someone isn’t depressed because they’re smiling in a photo isn’t an objective, logical path of thought. It’s conjecture. On the other hand, if someone claimed that their depression left them unable to leave the house, and then they posted photos of their two-week camping trip, that’s a bit more solid as evidence. Simply stated, if they say they can’t or don’t do it, and then post a photo online of themselves doing it, that’s objective evidence.
Even if the evidence you’re able to gather meets those three criteria, keep in mind it can be an uphill battle. That’s why this evidence should never be the cornerstone that your case is based on. Instead, it should be a sign for you to investigate the case more thoroughly.
What to Do When You Find Something on Social Media
The problem the insurance company that denied the depression case had was that they put all their stock in those online photos that showed a happy, smiling person. But any number of factors could influence those photos. If the company had conducted the investigation more wisely, then they wouldn’t have filed a denial based on social media. They would have instead used it as a sign to investigate further and show a pattern of activity.
We can break this down to a step-by-step process using a theoretical case. In this instance, the person claims they have no high-risk hobbies. During the period where they still have an opportunity to rescind the policy, the insurance company starts their investigation:
- They search for social media accounts – The insurance company uses the person’s name, date of birth and email to locate a social media account on Facebook or Twitter. The social media account shows the individual skydiving.
- They review the metadata of the photograph – Just because a photo was put up yesterday doesn’t mean it happened yesterday. Photos taken with cell phones and other digital media frequently have date stamps. This is either printed directly on the photo, or can be found in the metadata of a photo by using free online programs. In this case, the insurance company views the metadata and learns the photo was taken a week after the policy was issued.
- They request further verification from the applicant – While it sounds hard to believe, someone could get away with misrepresentation if they claim it wasn’t intentional (i.e. “I didn’t know skydiving was considered a high-risk activity”). So to verify that the misrepresentation is intentional, the individual is asked to complete a short, automated interview using Remote Risk Assessment technology. During this interview, they are specifically asked the question “Do you engage in any high-risk hobbies to include scuba diving, rock climbing, skydiving or any hobbies that require the signing of a waiver before participation?” If the individual answered “no,” they would be graded as high risk, indicating that further investigation is needed. This is done using proprietary signals analysis technology.
- They either rescind the policy or assign it for further investigation – If the premium has not been paid and the case is still in the initial investigation phase, the insurance company could rescind the policy outright. However, if the individual was paying premiums for a while, the deception indicated in RRA could be used to justify the hiring of a private investigator to gather further evidence of fraud.
Social media can be a useful tool in investigating insurance, if it’s treated just as that. A tool. When you find something on social media, you should use it to target your investigation, rather than as standalone proof.
Clearspeed offers RRA technology for use in the insurance industry, for both premium fraud and claims’ investigations. This technology can be adapted for most cases and used in any language. For more information on making RRA part of your investigation process, contact us.
Image Source | Flickr user Animated Heaven