The Impact of Insurance Fraud Detection Systems
AbstractThis article analyzes the impact of detection systems in an insurance fraud context. In a noncommitment Costly State Verification setting insurers can only detect fraudulent claims by performing costly audits, and policyholders are overcompensated by the optimal insurance contract. We show that auditing becomes more effective and overcompensation can be reduced, when insurers are able to condition their audits on the information provided by detection systems. Copyright The Journal of Risk and Insurance, 2006.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by The American Risk and Insurance Association in its journal Journal of Risk & Insurance.
Volume (Year): 73 (2006)
Issue (Month): 3 ()
Contact details of provider:
Web page: http://www.wiley.com/bw/journal.asp?ref=0022-4367&site=1
More information through EDIRC
Other versions of this item:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Demougin, Dominique & Fluet, Claude, 2001. "Monitoring versus incentives," European Economic Review, Elsevier, vol. 45(9), pages 1741-1764, October.
- Georges Dionne & Florence Giuliano & Pierre Picard, 2003.
"Optimal Auditing for Insurance Fraud,"
Cahiers de recherche
- Ines Macho-Stadler & David Perez-Castrillo, 2000.
"Auditing with Signals,"
Econometric Society World Congress 2000 Contributed Papers
0660, Econometric Society.
- Fagart, M.-C. & Picard, P., 1998.
"Optimal Insurance Under Random Auditing,"
9808, Paris X - Nanterre, U.F.R. de Sc. Ec. Gest. Maths Infor..
- Marie-Cécile Fagart & Pierre Picard, 1998. "Optimal Insurance Under Random Auditing," Working Papers 98-47, Centre de Recherche en Economie et Statistique.
- M-C. Fagart & P. Picard, 1998. "Optimal insurance under random auditing," THEMA Working Papers 98-08, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- Gale, Douglas & Hellwig, Martin, 1985. "Incentive-Compatible Debt Contracts: The One-Period Problem," Review of Economic Studies, Wiley Blackwell, vol. 52(4), pages 647-63, October.
- Ines Macho-Stadler & David Pérez-Castrillo, 2002.
"Settlement in Tax Evasion Prosecution,"
CESifo Working Paper Series
814, CESifo Group Munich.
- Picard, Pierre, 1996. "Auditing claims in the insurance market with fraud: The credibility issue," Journal of Public Economics, Elsevier, vol. 63(1), pages 27-56, December.
- Mookherjee, Dilip & Png, Ivan, 1989. "Optimal Auditing, Insurance, and Redistribution," The Quarterly Journal of Economics, MIT Press, vol. 104(2), pages 399-415, May.
- El Bachir Belhadji & George Dionne & Faouzi Tarkhani, 2000. "A Model for the Detection of Insurance Fraud*," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan, vol. 25(4), pages 517-538, October.
- repec:eme:jrfpps:v:11:y:2011:i:3:p:168-181 is not listed on IDEAS
- Boyer, M. Martin & Schiller, Jörg, 2003. "Merging automobile regulatory bodies: The case of Atlantic Canada," Working Papers on Risk and Insurance 11, University of Hamburg, Institute for Risk and Insurance.
- P. Picard, 2002.
"Costly risk verification without commitment in competitive insurance markets,"
THEMA Working Papers
2002-30, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- Picard, Pierre, 2009. "Costly risk verification without commitment in competitive insurance markets," Games and Economic Behavior, Elsevier, vol. 66(2), pages 893-919, July.
- Pierre Picard, 2012. "Economic Analysis of Insurance Fraud," Working Papers hal-00725561, HAL.
- Schiller, Jörg, 2004. "Versicherungsbetrug als ökonomisches Problem: Eine vertragstheoretische Analyse," Working Papers on Risk and Insurance 13, University of Hamburg, Institute for Risk and Insurance.
- Anthony Miyazaki, 2009. "Perceived Ethicality of Insurance Claim Fraud: Do Higher Deductibles Lead to Lower Ethical Standards?," Journal of Business Ethics, Springer, vol. 87(4), pages 589-598, July.
- Georges Dionne, 2012. "The Empirical Measure of Information Problems with Emphasis on Insurance Fraud and Dynamic Data," Cahiers de recherche 1233, CIRPEE.
- Suzanne H. Bijkerk & Vladimir A. Karamychev & Otto H. Swank, 2013. "Aggressive Reporting and Probabilistic Auditing in a Principles-Based Environment," Tinbergen Institute Discussion Papers 13-131/VII, Tinbergen Institute.
- M. Martin Boyer & Jörg Schiller, 2003. "Merging Automobile Insurance Regulatory Bodies: The Case of Atlantic Canada," CIRANO Working Papers 2003s-70, CIRANO.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.