6. Shared Insurance Databases and Flagging Suspicious Behavior
In response to Malloy’s case, the insurance industry began to set up shared databases and policy registries. Such systems allow insurers to check if an applicant already had coverage through other providers, how much coverage was in place, and whether any recent claims had been filed. Over time, those systems evolved into what is now known as Medical Information Bureaus (MIBs), which store insurance applications and claims data.
The tracking systems also introduced flags for suspicious behavior, such as repeated applications on the same individual or unusually large amounts of coverage requested within a short time. That made it more difficult for fraudsters to operate across multiple insurers undetected, as happened in Malloy’s case.
