Money Laundering (ML) and Terrorism Financing (TF) in the Insurance Market : A Risk and Vulnerability

Following the risk and vulnerability of banking sector, insurance sector is equally the target of the criminal. Criminals involving in ML or TF seek an opportunity to legalize their black money from insurance business as well. Customers willing to accept unfavorable policy, involvement of the undisclosed party, exaggerated claim/false or bogus claim are the common insurance fraud. Claim with fake death and lose of memory are the frequent fraudulent behavior in life insurance. Failures to pay premiums, non-proportionate commission, and insurance policy from non-existing companies show occupational fraudulent behavior and hyperbolic claim, charlatan medical document, post dated policies; fabricated extortion, kidnapping, and murder are other stratagem of the criminals. Although the life insurance sector is highly vulnerable, there is equally the risk of ML/TF through general insurance, reinsurance, intermediary and agents. Intermediaries, the brokers or agent not affiliated with company, may offer the riskier product, which is more vulnerable in those country where no sufficient ML/TF measure is in line