o_1915f04bi181p2m9qs12em17oea.pdf

Business, Careers & Technology
Just how
big is
insurance
fraud in
Zimbabwe?
Recent media reports indicate
that Zimbabwe could
now be a safe haven for
insurance fraudsters who
prey on unsuspecting insurers or service
providers.
Big Brother winner Wendall Parsons
was arrested last year after he was
accused of having committed insurance
fraud to the amount of $25 000. Allegations
are that he claimed insurance for a car
which he had crashed when in fact the
car was not insured at the time thereby
prejudicing an insurance company of the
said amount. He was however, acquitted
of the crime, the case however is; how
many other people out there are guilty of
such predetermined crimes?
Recently Cimas a medical aid service
recently announced it was upgrading its
system especially cards that it issued to
its members. This followed widespread
abuse of the present cards by members
who used them to pay for medical bills of
persons not covered by the medical aid.
Cimas says this is insurance fraud and
i t
h a s in the
past issued statements encouraging its
members to desist from such practices.
Douglas Hoto, chief executive of First
Mutual Limited a life assurance company,
recently told The Parade that insurance
fraud was real and sometimes people
committing this thought it was not a
crime.
In the life assurance business cases of
fraud were very low according to Mr Hoto
because companies had devised systems
that would easily detect fraudulent
claims.
However, criminals still tried to
defraud the insurers by using fake
documentation. In this case First Mutual
Limited, Mr Hoto said his company now
made it a point to accompany persons
whom they suspected to be using fake
documents, to the funeral just to verify
if indeed there had been a death of an
insured member.
“It happened that one of our clients
wanted to defraud
us, he claimed that his father had
passed away. We gave him part payment
accompany him and we would release the
rest of the money when we arrived at the
funeral. The guy wanted to run away on
hearing this,” said Mr Hoto.
He explained that is how First Mutual
Limited was dealing with cases of funeral
insurance fraud. However, First Mutual
Limited had a health insurance arm
and just like Cimas, it faced sustained
fraudulent claims from members.
“When someone is sick but are not
insured, their insured relative will
negotiate with the medical practitioner
to treat the sick person using the card
issued to the insured relative,” lamented
Mr Hoto.
2014, First Mutual Limited had detected
about $30000 worth of such claims which
it disputed and did not pay. Doctors
apparently are part of the problem and as
a result insurers have had to devise ways
Page 72 The Parade - Zimbabwe’s Most Read Lifestyle Magazine
August 2014