AIC 300 - Claims in an Evolving World - Complete Solutions with Verified Answers The first step in the data mining process is to A. Collect the data
... [Show More] that will be used. B. Select a data mining technique. C. Understand what a business wants to achieve. D. Prepare the data that will be used. Generally speaking, the most common application of predictive modeling in insurance occurs in A. Risk selection. B. Marketing. C. Reinsurance. D. Claims handling. Hanna is in IT and works on data analytics projects for an insurer. These projects involve analyzing large amounts of data to help underwriting to select risks and price policies. Hanna knows that collaboration between data science, IT, underwriting, and actuary is critical to the success of these projects. In Hanna's experience, as soon as the need for a data project arises, the key to collaborating effectively is to engage which one of the following teams as soon as possible? A. Actuary B. IT C. Underwriting D. Data science Data science team needs to be engaged as soon as the need for a project arises. Part of the continuous cycle of data mining is preparing the data to eliminate missing or inaccurate information. This process is called A. Machine learning. B. Parsing. C. Predictive modeling. D. Cleaning. Data should be cleaned as much as possible to eliminate missing or inaccurate information. Which one of the following types of workers compensation claims are the most difficult for insurers to identify at the time of first report? A. Catastrophic claims B. Medical-only claims C. Potentially minor claims D. Potentially complex claims Potentially complex claims are the most difficult for insurers to identify at the time of first report. Soft fraud, also called opportunity fraud, occurs when A. An application for insurance contains untrue information. B. A legitimate claim is exaggerated. C. A loss is triggered intentionally. D. A claim is filed for a loss that did not occur. Soft fraud, also called opportunity fraud, occurs when a legitimate claim is exaggerated. Carla is investigating a claim for a stolen car. The insured provided a copy of the police report, but she notices that the account in the police report differs from the insured's version of events. At this point, Carla should A. Refer the case to the SIU. B. Continue with her investigation. C. Deny the claim. D. Contact the police. Continue with her investigation. Indicators of fraud are not proof of fraud. Benjamin is with the SIU department of an insurer. His company developed technology to identify patterns related to fraudulent claims activity. He is using a program to analyze claims data to identify similarities or connections that might indicate fraud. Benjamin is utilizing A. Data mining. B. Telematics. C. Claims audits. D. Wearables. Data mining. This is using computers to analyze vast amounts of data to detect trends. Soft fraud occurs when a claim is exaggerated and is also referred to as A. Victimless fraud. B. Reimbursement fraud. C. Opportunity fraud. D. Financial fraud. Larissa is an auto claim adjuster. Traditionally, she has relied on police reports and witness testimony in her decision making. Recent technological developments give her access to the driver's driving habits, including acceleration, speed, and braking. This data available to Larissa is known as A. Artificial Intelligence. B. Telematics. C. Wearables. D. Internet of Things. Telematics are used to collect data on personal autos, commercial vehicles, products, shipments, machinery, smart devices, and workers. Martin is in SIU and helps his employer, a multi-line insurer, to detect fraudulent claims. He is using a technology that enables insurers to share fraud-related information. This distributed digital ledger that facilitates secure transactions without using a third party is known as A. Blockchain. B. A predictive model. C. The Internet of Things. D. Telematics. By having a transparent ledger associated with a car, for example, insurers can detect fraud that would be difficult to detect otherwise. Jack leads the claims department for a large insurer and has embraced the recent developments in claims data collection and analysis. Jack knows that A. People make little difference in analyzing data and explaining it to a customer. B. Claims determinations and payments will soon be accomplished entirely by AI. C. He will eventually not need people because insurance is not a customer-driven industry. D. He still needs people because the data need to be analyzed in context by a human. As a claims representative, Beatrice is on the front lines for protecting her employer from insurance fraud. Beatrice should understand that insurance fraud A. Is the costliest white-collar crime in the U.S. B. Accounts for 25 percent of the P&C industry incurred losses. C. Costs roughly $40 billion per year, excluding health insurance. D. Costs each American family between $2,000 and $4,000 per year. Ella sued her insurer and alleged bad-faith claim handling after the insurer settled a claim against her that Ella thought should have been denied. As a result of the settlement, Ella's premium increased. In her suit, Ella claimed that the insurer rushed [Show Less]