FIVE EMERGING STRATEGIES TO DETECT AND CONTROL FRAUD: MULTIPLE CASE STUDIES

Abstract

Abstract

Fraud continues to pose a significant threat to companies, particularly in digitally-driven, high-volume environments such as the insurance sector. This article examines five emerging strategies—reactive, proactive, preventive, curative, and deterrence—used to detect and control fraud in Indian insurance companies over the last decade. A qualitative multiple-case study methodology was employed, focusing on three leading insurers. Data were analyzed using Dynamic Capability theory, emphasizing absorptive, adaptive, and innovative capacities to understand how firms anticipate, respond to, and mitigate fraud risks. Findings reveal that reactive strategies facilitate post-incident investigations and learning, proactive strategies leverage analytics and field investigations to anticipate fraud, preventive strategies strengthen internal controls and due diligence, curative strategies address systemic weaknesses from prior incidents, and deterrence strategies employ sanctions, regulatory escalation, and industry-wide collaboration. Companies effectively integrate these strategies, using dynamic capabilities to enhance resilience, reduce losses, and build stakeholder trust. The study contributes to the literature by empirically demonstrating the application of multi-layered fraud management strategies in the insurance context, bridging gaps in operationalizing traditional fraud theories such as the Fraud Triangle, Diamond, and Pentagon. Practically, the article highlights how insurers can combine multiple strategies and leverage organizational capacities to mitigate risks efficiently. These insights are valuable for policymakers, regulators, and industry practitioners seeking to strengthen fraud governance frameworks in emerging markets.