KYC Solutions: The Game-Changer for Insurance Companies in Canada

The Canadian insurance industry is a behemoth of financial businesses, with over $1 trillion in assets and millions of policyholders. However, financial fraud is a hidden enemy of the insurance industry in the digital age. Annually, insurance fraud inflicts an astounding $8 billion financial burden on the Canadian economy, as reported by the Insurance Bureau of Canada. This sum could alternatively fund the medical expenses of over 1 million Canadians or facilitate the construction of 50 new hospitals.

How is KYC Solution a game-changer for insurance companies?

KYC plays a massive role for insurance companies in protecting the insurance business from the flood of fraudulent claims. KYC solutions assist in authenticating the authenticity of the new customer while onboarding and ensuring that they are who they say they are. People try to purchase and claim insurance using fraudulent identities in the insurance sector. KYC solutions come into play to identify these identities and help combat identity fraud. KYC solutions like document verification and biometric authentication act as gatekeepers, ensure only legitimate customers can purchase the insurance, and even assist during the insurance claim. There are some other benefits of KYC for insurance companies that are also important.

1. Prevent financial crimes: Identities involved in money laundering, tax evasion, terrorist financing, illicit funding, and other illegal activities, KYC solutions help identify and verify those identities and give a red alert for high-risk clients for insurance companies. Based on the KYC result, the insurance company can evaluate the business risk associated with the client and prevent financial fraud. A genuine client base always leads to a successful business and helps grow. Therefore, KYC is essential in knowing the client’s identity and mitigating the risk.
2. Adherence to Regulatory Compliance: KYC helps meet strict Canadian regulations like FINTRAC and protects the insurance company from hefty fines and reputational damage. It ensures financial rules as per the standards in the ever-evolving digital landscape.
3. Improve Customer Experience: Streamlined KYC processes lead to faster onboarding and create smoother and more positive customer experiences. It verifies identities quickly, delivers the result instantly, and saves time. In everyone’s busy schedule, time is money. So, it helps to improve the customer experience by providing a fast and accurate KYC process.
4. Reduce Operational Costs: Automating KYC tasks saves time and resources and allows insurance companies to focus on core business activities.
5. Reputation: KYC solutions help insurance companies and even other financial companies maintain a fraudless image in the digital age and help to build their reputation. It also helps to build customer trust and enhance business growth.

Video KYC Solution for Insurance:

A video KYC solution is a more secure way of doing KYC, as this process is completed on a replayed video call between the customer and the agent. The agent verifies all the ID documents on a video call, and face recognition is also a feature to match identities accurately. Video KYC is a preferable choice for the insurance industry because it assists while onboarding the new customer and even during the claim by the policyholder. It helps to verify the identity of the customer and ensure that the customer is the one who purchased the insurance during the time of maturity.

It helps mitigate risk, protect vulnerable customers, build trust, and maintain reputation by ensuring fraud-proof business transactions.

Conclusion:

KYC is not just a regulatory checkbox; it’s a strategic investment for insurance companies to secure business in Canada. With robust KYC solutions, Canadian insurance companies can build a more secure, efficient, and trustworthy ecosystem for themselves and their customers. So, it’s time to ditch the outdated paper-based processes and implement the future of KYC. The Canadian insurance industry needs an AI-powered identity verification system to protect against financial criminals and vulnerable insurance customers.