Insurance Midterm Adjustment ATO
The insurance industry collects more than $1 trillion in insurance premiums every year, which makes the industry a prime target for a wide variety of fraudulent activities. It is estimated that insurance fraud (not including health insurance fraud) costs the average family in America between $400 and $700 per year in increased premiums.
Unfortunately, there are hundreds of different ways to commit insurance fraud, by a wide range of parties. From scam artists to the insured to even agents themselves. Up until now, most insurance fraud has been in the form of submitting fraudulent claims. Until recently, the insurance industry was not as susceptible to cybercrime as many other financial institutions. With most financial institutions beefing up their cybersecurity protocols however, cybercriminals have started looking more in the direction of "soft targets" such as the insurance industry. While increased security measures are reducing total identity theft, ATO or Account Takeover is on the rise. Account takeover is a type of identity theft where a cybercriminal hijacks a legitimate account and gives themselves access to it. In some cases, they gain joint access with the legitimate account holder and in some cases, they can even lock the legitimate account holder out entirely. Here is an overview of insurance midterm adjustment ATO, what it is, how it happens and how it can be prevented.
What is Midterm Adjustment Account Takeover?
Most financial transactions are verified through the exchange of information which is also easily obtainable. Thanks to a number of high profile data breaches, there are few people that don't have a vast amount of personal data available for sale on the dark web. It is estimated that in 2017 alone, more than 8 billion files containing personal details were stolen from businesses, with a new breach occurring almost daily.
The stolen information includes personal details like the last four digits of your social security number (if not the entire number) your address, phone number, place of employment and in some cases, even the names of relatives or pets. There are all kinds of ways in which this information can be used by criminals to gain unauthorized access to a legitimate account. Once they have gained access, they can transfer money, change account details or even use the accounts for fraudulent or illegal activities. Almost anything that has any kind of monetary value is at risk for account takeover, and this includes insurance policies.
How is Midterm Adjustment ATO Commited?
Most insurance policies have a term, such as six months or one year. As a rule, most insurance agents recommend people review their insurance policies annually to ensure they still provide adequate coverage and protection. In some cases, however, individuals may experience life changes or want to make changes to their policies midterm. These can include changes such as buying or selling a vehicle, selling a home and renting an apartment instead or adding a beneficiary to a life insurance policy. Because there are few ways to literally steal money from an insurance company, many have been slow to institute the same levels of digital security that banks and other financial institutions have long been implementing. An insurance midterm adjustment ATO, however, allows cybercriminals to make changes to a policy that they can benefit from financially.
Life insurance and annuities are both financial tools that are offered and administered by insurance companies. There are two types of life insurance policies: whole and term. A term life insurance policy expires after a set number of years (generally ten years) so it has little cash value. A whole life insurance policy never expires, however, and you can actually borrow money against a whole life insurance policy. Annuities are also a type of insurance you can sometimes borrow against and that is what makes them attractive to cybercriminals. An insurance midterm adjustment ATO is when a cybercriminal gains access to an insurance account and then makes changes to the policy that allows them to gain a financial advantage.
In some cases, they may take out a loan against the life insurance policy or they may sell the rights to an annuity. The transfer of rights generally requires an appearance in court to finalize, but many companies will pay a portion of the annuity up front. So, for instance, if a beneficiary has an annuity worth $50,000 a cybercriminal may gain access to the annuity account and attempt to sell the rights to it. It can take up to 60 days or more to complete the transaction, but they may receive up to $5,000 up front. More than likely the account holder will discover the fraud before the sale is fully complete, but they may still be out the $5,000 that was paid up front. Even if the insurance company ends up absorbing the loss, it will still find its way back to the public in the form of increased premiums to cover total annual losses due to fraud.
Midterm Adjustment Account Takeover Detection & Preventionront
While there aren't as many ways to profit financially from insurance account takeover aa from other types of financial accounts, they do actually exist. As a result, it is important for insurance companies to institute the same security protocols as all other financial institutions. These include protocols such as multi-factor authentication, web beacons that track a user's IP address and other algorithm's that track a user's online patterns. In addition, it is also important for policyholders to take responsibility for adhering to good internet safety protocols. These include using strong, unique passwords and changing them frequently as well as avoiding using public WiFi or using a VPN. Policyholders also need to be aware of phishing scams and never click on links that are ostensibly sent by the insurance company. While policyholders may not be able to do a lot about the level of internet security their insurance company provides, there are always things they can do to protect their accounts.
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