Insurance Fraud Detection and Investigation Practices in Nigerian Insurance Companies

This study examines fraud detection and investigation practices in Nigerian insurance companies, focusing on the operational effectiveness of anti-fraud units and the application of data analytics in identifying fraudulent claims. Insurance fraud imposes substantial financial costs on the industry and indirectly raises premiums for legitimate policyholders. In Nigeria, motor, marine, and fire insurance classes record the highest fraud incidence rates, yet the systematic application of modern fraud detection technologies and investigation protocols varies considerably across firms. This research employs a professional practice evaluation design with data from 50 fraud investigation officers, claims managers, and internal audit practitioners at twelve insurance companies operating across Lagos, Port Harcourt, and Abuja. Semi-structured interviews and questionnaires assess fraud detection methods, investigation workflow, collaboration with law enforcement, use of forensic tools, and the effectiveness of fraud management policies. Thematic and comparative analysis characterize best and poor practices. Preliminary findings are expected to reveal that fraud detection in most Nigerian insurers remains primarily manual and reactive rather than technology-assisted and proactive. The study recommends that NAICOM mandate minimum anti-fraud technology standards and that the Nigerian insurance industry establish a shared fraud intelligence database. Keywords: Insurance Fraud, Fraud Detection, Investigation Practices, Anti-Fraud, Nigerian Insurance.