An estimated $2 billion in auto premiums is lost annually to garaging misrepresentation, and recent studies from Verisk indicate the problem may be even more serious. Verisk’s GarageConfirm uses a license plate database developed by DRN to help insurers identify and combat garaging fraud.
GarageConfirm taps into DRN’s vehicle location database containing more than 4 billion license plate scans, the largest of its kind. The system measures the time, frequency, and proximity of vehicle sightings relative to given addresses — data previously available only to law enforcement and the automotive lending industry. Grouping data into clusters of sightings and measuring geospatial information, GarageConfirm tells insurers where a vehicle has been recently identified. Insurers can use this data to determine the validity of garaging addresses and commute mileage, spot “red flags” that need further investigation, and recover lost premiums.
Insurers can use GarageConfirm at point of sale or renewal just before binding to ensure that the claimed garaging address is accurate. They can also use the tool in conjunction with other products such as RISK:check® Point of Sale to identify fraud risk associated with the applicant.
While GarageConfirm is well suited for high-cost, high-rate-evasion areas such as New York, many cases of fraud occur in low-cost or even rural settings where the customer claims to garage the vehicle. Insurers will find GarageConfirm invaluable at the underwriting stage to write and price policies correctly and during renewals for continuous rating integrity.