Anti-Money Laundering In The Insurance Industry


Around 62% of the global insurance firms have been exposed to fraud or financial crimes in the past 24 months. In other words, money laundering in the insurance sector is a growing global problem. To counter the persistence of the crimes, global anti-money laundering (AML) regulations have been forced to adapt faster than ever before.

The AML regulations involve both transaction monitoring and sanctions screening obligation. Those regulations are not only applicable to banking, financing, money transaction or remittance businesses. Insurance and Takaful operations are also subject to the same regulations. Indeed, it is critical for insurance products with cash values- especially life insurance.

The massive flows of funds in and out of the insurance sector provide opportunities to launder money. To manage this threat, authorities around the world have imposed a range of AML insurance policies in recent years. Accordingly, Bank Negara Malaysia (BNM) has increased its focus and enforcement on insurance businesses, recommending insurance companies to adopt greater automation in the AML compliance processes.

A Digitized Insurance Industry

As digitalization sweeps across the world, insurance companies will need to move away from conventional manual eyeballing of sanction names to real-time and sophisticated tools that enable automated screening.

In line with the digital transformation, companies should leverage on fuzzy logic and multifactor identification to perform customer due diligence screening against updated sanction lists to identity potential sanction entities.

Traditionally, insurance companies relied on IT-generated reports or reporting extraction tools to detect suspicious transactions. However, with the ever-changing compliance and regulatory rules, the turnaround time to implement these new scenarios is getting shorter. To keep up, insurance companies should utilize a rules-based engine that enables quicker, user-configurable and parameterizable scenario building, testing, and deployment to production.

Furthermore, insurance companies will need to monitor and manage these cases, route and escalate them to the relevant investigation officer or management for approval, to ensure that nothing falls through the cracks. The penalty imposed for not reporting is severe, and leads to reputation risk for the financial institution.

The insurance business deals with people and policies, as compared to customers and accounts. The range of activities for insurance includes purchases, renewals, alterations, withdrawals, and claims. Not to mention, the suspicious transaction scenarios for insurances are different from a bank. The AML solution should be tuned for such activity tracking and the corresponding detection rules.

AML Solutions for the Insurance Industry

The volume of transactions in insurance is low in comparison with the number of accounts or customers. Insurance companies’ compliance unit will need a flexible solution tailored to meet the regulatory and compliance needs of insurance companies, at the right price point. Unfortunately, many existing AML solutions are unable to be customized to follow suit, or affordable for the limited volume of transactions.

At INFOPRO, we offer a comprehensive AML framework that addresses the full range of compliance processes, from fuzzy logic-based name screening and customer profiling during KYC to transaction monitoring and STR reporting.

One can perform regular rescreening of customer databases, automated uploading of sanction lists, and risk-based approach for transaction monitoring with configurable rules. Infopro’s AML solution is also enhanced with AI to prioritize high probability suspicious transactions and optimize the compliance officers’ workload.



Contact Us

Contact our sales team or business advisors to help your business.


Block B3 Level 8, Leisure Commerce Square, No. 9, Jalan PJS 8/9, 46150 Petaling Jaya, Selangor
+60 (3) 7876 6666





Block B3 Level 8, Leisure Commerce Square, No.
+60 (3) 7876 6666