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What is identity proofing?
A well-integrated identity proofing solution can help reduce workload and increase claim handling rates by shifting repetitive tasks from employees to automated software or outsourcing manual work from employees to vetted vendors. This can happen when the identity proofing solution is automated in a few key ways:
- Identifying and correcting for errors, e.g., due to typographical errors in applications by either the claimant or employer
- Identifying one-off fraud by individual applicants, e.g., intentionally duplicate claims
- Identifying widespread fraud by criminal organizations, e.g., use of synthetic and/or stolen identities to claim benefits
Unemployment claims are susceptible to a few kinds of errors and fraud, some of which identity proofing can prevent or catch. Finding the right solution can be a balancing act, because you want to find fraudsters while maintaining an efficient and fair process for legitimate claims. If you tip too far one way, you may not be able to catch the fraudulent actors; if you tip too far the other way, you may incorrectly target legitimate claims, resulting in delays and hardship for claimants.
Unemployment insurance systems already have automated identity proofing solutions! They are used to cross-reference and verify the information given by an applicant and their former employer(s) with government databases like those from Departments of Motor Vehicles or the Social Security Administration.
However, more extensively automated identity proofing can help when someone’s identity is not resolved by the existing system, and can also go a step beyond by finding synthetic identity fraud. For the former, these applications are queued for manual review and additional document collection. In the worst-case scenario, this requires an applicant to mail or fax a copy of the required documents; in the best-case scenario, an applicant can upload the documents to the benefits website. An identity proofing system that automatically handles errors and uncertainties will prevent applicants from winding up in your backlog.
In the long term, issues that could be resolved by identity proofing should make up a much smaller proportion of the backlog, but for now, unemployment insurance agencies could find relief by working with an identity proofing vendor that can validate identity documentation without employee intervention.