GDPR - A new challenge in the insurance fraud fight

12 June 2018 — Daniela GHETU
Application of the General Data Protection Regulation (GDPR) may significantly impact upon insurance industry's projects which imply data sharing between members, among others for fraud fight purposes, Irish Minister for Justice Charlie Flanagan has said, reports The Irish Times.

Mr. Flanagan's statement came in response to a parliamentary interpellation about the steps that were taken to deal with fraudulent insurance claims, which are considered as one of the reasons leading to motor insurance costs increase. In January, last year, a report released by the Cost of Insurance Working Group was recommending, among other measures for a better control of the motor insurance price level, the establishment of a national claims information, funded by the industry but managed and store by an independent body, as the Central Bank.

Yet, while adding data to the already existing InsuranceLink - insurance claims database created by Insurance Ireland and the self-insured claims task force to assist their members in the detection and defense of exaggerated claims which may result in prosecutions for fraud - will obviously require a serious analysis to justify the potential addition of new datasets, the structured and content of InsuranceLink database itself is put under scrutiny.

"In 2010, the Data Protection Commissioner carried out a special investigation into the Insurance Link industry database, which at the time had over 2.4 million claim records on Insurance Link representing details on a large part of the population.

The investigation was prompted by "significant concerns" on the part of the commissioner about the operation and legitimacy of the database and its compliance with data protection legislation", wrote Irish Times. It found that "far too many individuals in insurance companies had access to the database with little or no oversight of that access".

As a result, Charlie Flanagan said that as a first step, "it is necessary for the insurance industry to undertake a review of the information held on the Insurance Link industry database in the context of GDPR".

As the insurance claims databasis, in different forms, are holding an important part in the insurance fraud fight in most European markets, the Irish "case" will probably not remain a singular one, meaning that GDPR application will additionally challenge insurers in their attempts to control the insurance fraud phenomenon.

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