While incumbent insurance providers continue to get disrupted by startups like Lemonade, Alan, Clearcover, Pie and many others applying tech to rethink how to build a business around helping people and companies mitigate against risks with some financial security, one issue that has not disappeared is fraud. Today, a startup out of France is announcing some funding for AI technology that it has built for all insurance providers, old and new, to help them detect and prevent it.<\/p>\n
Shift Technology<\/a>, which provides a set of AI-based SaaS tools to insurance companies to scan and automatically flag fraud scenarios across a range of use cases \u2014 they include claims fraud, claims automation, underwriting, subrogation detection and financial crime detection \u2014 has raised $220 million, money that it will be using both to expand in the property and casualty insurance market, the area where it is already strong, as well as to expand into health, and to double down on growing its business in the U.S. It also provides fraud detection for the travel insurance sector.<\/p>\n This Series D is being led by Advent International, via Advent Tech, with participation from Avenir and others. Accel, Bessemer Venture Partners, General Catalyst and Iris Capital \u2014 who were all part of Shift\u2019s Series C led by Bessemer in 2019<\/a> \u2014 also participated. With this round, Paris-and-Boston-based Shift Technology has now raised some $320 million and has confirmed that it is now valued at over $1 billion.<\/p>\n The company currently has around 100 customers across 25 different countries \u2014 with the list including Generali France and Mitsui Sumitomo, to give you an idea of where it\u2019s pitching its business \u2014 and says that it has already analyzed nearly two billion claims, data that\u2019s feeding its machine learning algorithms to improve how they work.<\/p>\n The challenge (or I suppose, opportunity) that Shift is tackling, however, is much bigger. The Coalition Against Insurance Fraud, a nonprofit in the U.S., estimates that at least $80 billion of fraudulent claims<\/a> are made annually in the U.S. alone, but the figure is likely significantly higher. One problem has, ironically, been the move to more virtualized processes, which open the door to malicious actors exploiting loopholes in claims filing and fudging information. Another is the fact that insurance has grown as a market, but so too has the amount of people who are in financial straights, leading to more desperate and illegal acts to gain an edge.<\/p>\n