In its ongoing efforts to rid the Kenyan Insurance sector of fraud, the Insurance Fraud Investigations Unit, IFIU has arrested and charged two persons for the offense of conspiracy to defraud and obtaining credit by false pretenses.
An inquiry file for the two accused Grace Atieno Okal and Gladys Atieno Mboya indicates that on diverse dates between June and August this year, at Nairobi Women’s Hospital Adams Arcade Branch, Grace Okal being an accident victim utilized a Jubilee Medical Card No. 114-01 purporting to be Gladys Atieno Mbuya the legit card owner. It is also indicated that medical treatments received amounted to Kshs 1,041,574.49/=.
The Suspects have been arraigned before Milimani Law Courts to face the fraud charges, as investigations continue to arrest more culprits in the matter.
The Insurance Regulatory Authority (IRA) continues to rely on the Unit manned by the CID to identify fraud cases in the sector, among other interventions e.g the use of technology to cut the use of paperwork, validate documents from customers and provide permanent audit trails that can be used to identify claims.
Established in 2011, due to rising cases of insurance fraud, IFIU carries out investigations, interviews suspects, makes arrests and charges suspects according to the law, profile fraudsters, manage fraud intelligence data and advice on ways of mitigating fraud. Fraud in the insurance sector as a whole has been linked to increases in the cost of doing business, higher premiums among others.
Driving consumer education and awareness also plays a role in IRA’s wider agenda of consumer protection initiatives, which among others ensures that players comply with the provisions of the Insurance Act CAP 487. According to the Authority, approximately 40% of all insurance claims are fraudulent, with fraudsters listed to include doctors, ambulance chasers, police, lawyers, motor garages, employees of insurers among others.
Recent efforts by industry players to curb insurance fraud have seen insurers through the umbrella body Association of Kenya Insurers AKI, seek for a consultant to help create a common health insurance database to curb rising fraud, especially in the medical segment. AKI hopes to create a system that will provide a range of fees for various medical procedures, thus aiding the industry flag fraud, should any charges reach the upper limit.
According to the Revised Insurance Act of 2020, A person is guilty of an offense of insurance fraud where knowingly, by act or omission with intent to injure, defraud or deceive presents, causes to be presented, prepares, assists, abets, solicits, or conspires with another or makes any oral or written statement with knowledge or belief that it will be presented to an insurer in connection with, or in support of, any application for issuance of an insurance policy, containing false or misleading information concerning any fact material to the application for issuance of an insurance policy with intent of committing a fraud.
The law further indicates that a person licensed under this Act or any person who offers any service in relation to insurance business or any other professional is guilty of an offense of insurance fraud shall on conviction be liable to a fine of ten times the amount defrauded or intended to be defrauded or to imprisonment for a term not exceeding five years or both. Any person who is responsible for the loss of any money, property or assets shall be liable for recovery in a civil suit, the law also states.