TransUnion determines suspected Canada-based fraud attempts increased 125% against insurance industry in Q2 2022 – despite an overall 37% decline across all industries during that period
TORONTO – According to a TransUnion Canada TruValidate study, for the second consecutive quarter, the rate of suspected global digital fraud attempts in the insurance industry experienced the greatest rise on a year-over-year basis, increasing 159% between Q2 2021 and Q2 2022 (+125% originating from Canada). This follows a 134% global increase between Q1 2021 and Q1 2022 (+151% originating from Canada). Despite this rise in suspected fraud against the insurance industry, TransUnion’s (NYSE:TRU) quarterly fraud analysis observed that the overall rate of suspected digital fraud attempts across industries globally declined by approximately -14% between Q2 2021 and Q2 2022. In Canada, suspected digital fraud attempts decreased -37% in the same timeframe.
“In recent years, we’ve seen fraudsters shift their industry focus each quarter as they recognize that businesses have put more controls in place. These fraudsters are like chameleons – always adapting,” said Patrick Boudreau, head of identity management and fraud solutions at TransUnion Canada. “We have observed interesting trends in the first half of 2022 with suspected fraudulent activity in the insurance industry spiking during the first six months of the year. At this time, we believe the insurance industry is seeing more ‘soft fraud’ – meaning when a policyholder misrepresents certain information or circumstances in an effort to lower the policy’s premium. It may be that some consumers are representing their policies incorrectly to try to save money, especially in a high inflation environment that places more pressure on their wallets.”
Digital fraud continues to be a constant in the lives of many Canadian consumers. TransUnion’s latest Consumer Pulse study found that about 3 in 10 (31%) Canadian adults reported experiencing digital fraud attempts. And 7% fell victim to fraud such as phishing, identity theft or other types of fraud.
Suspected Digital Fraud Attempts Shift to New Industries Globally vs. Canada
|Industry||Canada Rate Change from Q2 2021 to Q2 2022||Global Rate Change from Q2 2021 to Q2 2022|
|Communities (online dating, forums, etc.)||+10%||-8%|
|Travel & Leisure||-6%||-28%|
“The digital acceleration brought about by the pandemic has permeated industries that have traditionally operated offline, which fraudsters are trying to capitalize on,” said Boudreau. “At the same time, for the industries that are finding fraud instances starting to stabilize, the focus has shifted to identifying the ‘good’ transactions and enabling them to sift through with less friction. For many industries and businesses, it is a challenge to balance implementing the necessary security measures to help weed out potential fraudsters – without creating friction for their genuine customers. Strong fraud and authentication practices can dramatically decrease false positives and focus fraud-fighting resources on the minority of interactions that warrant scrutiny. By reducing the pool of manual reviews and customer interrogations, organizations can dramatically reduce costs, increase revenue and improve the overall customer experience.”
About The Study
TransUnion came to its conclusions about fraud against businesses based on intelligence from billions of transactions and more than 40,000 websites and apps contained in its flagship identity proofing, risk-based authentication and fraud analytics solution suite – TransUnion TruValidate. The percent or rate of suspected digital fraud attempts are those that TruValidate customers either denied or reviewed due to fraudulent indicators compared to all transactions that were assessed for fraud.
For worldwide and regional breakdowns around how much the suspected digital fraud attempt rate recently changed, what types of fraud are most prevalent in certain industries and more, please download the infographic.
About TransUnion (NYSE: TRU)
TransUnion is a global information and insights company that makes trust possible in the modern economy. We do this by providing an actionable picture of each person so they can be reliably represented in the marketplace. As a result, businesses and consumers can transact with confidence and achieve great things. We call this Information for Good.® TransUnion provides solutions that help create economic opportunity, great experiences and personal empowerment for hundreds of millions of people in more than 30 countries. Our customers in Canada comprise some of the nation’s largest banks and card issuers, and TransUnion is a major credit reporting, fraud, and analytics solutions provider across the finance, retail, telecommunications, utilities, government and insurance sectors.