Online Insurance Transactions, the New Target for Fraud

Nov 19, 2019

For business owners, shifting to online platforms often comes with a host of risks no matter the industry you serve. Anyone can be a target!

And now, new data from recent research by Iovation reveal that insurance is the next favorite e-commerce fraud target. Cybercriminals are increasingly eyeing firms that offer insurance services as web-based payments for the sector surge in the United States.

Iovation released these findings after analyzing new trends in cybercrime. The year-long scrutiny looked into 10 billion web-based transactions and found around 5 percent of those risky. Of all the payments categorized as risky, insurance payments were almost double the digit at 9 percent.

In the report, the researcher mentioned that as more United States customers accept and embrace the practice of making insurance payments online, fraudsters will find a way to take advantage of this lucrative business.

Insurance apps linked to increased risks

The increasing adoption of insurance apps among millennials is linked to the increase in the risk of fraud in insurance payments.

Here’s separate yearly research to prove that;

Mintel is an international business intelligence. In its 2017 study, less than 10 percent of US-based insurance consumers admitted to using the mobile apps provided by their medical insurance companies.

In 2018, the digit grew almost threefold to 25 percent. The researcher also noted that this year, 25 percent of young generation customers are eager to go through a web-based insurance request process while an entire 30 percent of the same group are eager to use mobile apps for their insurance coverage solutions.

Mobile device usage rates are highest among millennials which explains why they are quicker to accept insurance apps than the older generation.

Final Words

Whether the next money heist will target the online insurance sector or not remains unknown to consumers and merchants.

But such reports should ring loud bells to the industry. Companies should get their houses ready for an approaching tornado that can threaten to bring down a whole brand.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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