Instnt has entered a strategic partnership with Munich Re to increase reinsurance capacity for its fraud loss insurance product.
The product, which merges real-time digital onboarding technology with risk transfer mechanisms, is designed to help businesses reduce exposure to identity fraud and access financial recovery options.
According to Nasdaq, fraud losses reached an estimated US$485.6 billion globally in 2023. The figure underscores the growing scale and sophistication of fraud targeting organizations worldwide, and has prompted greater demand for risk-transfer mechanisms that supplement traditional fraud detection and prevention tools.
Munich Re will act as reinsurer behind the coverage offered by Instnt’s product. Michael von Gablenz (pictured), head of Insure AI at Munich Re and HSB, said the company’s support draws from its aiSure platform.
“Instnt combines AI-based fraud detection technology with financial risk transfer, in case the AI fails to recognize fraud events. This combination of AI and fraud insurance can provide protection for companies against a wide range of fraud events,” he said.
The partnership is part of Munich Re’s broader efforts to address evolving technology risks through customized insurance structures. The reinsurer has been expanding its portfolio of AI performance guarantees and underperformance insurance, designed to step in when machine learning systems do not meet specified operational thresholds.
Instnt’s current insurance and reinsurance partnerships also include Accredited and Howden. The involvement of these firms supports the infrastructure, including underwriting, risk mitigation, and claims management services.
The company’s use of AI also aligns with a wider trend across the insurance sector, where machine learning is being applied to fraud detection through anomaly analysis and behavioral modeling.
These tools help insurers and vendors flag potentially fraudulent transactions with greater speed and accuracy, forming the foundation for real-time identity verification systems used in onboarding and transaction monitoring.
Sunil Madhu, Instnt’s founder and CEO, said the company’s goal is to shift fraud from an operational cost to an insurable exposure.
“With Munich Re’s backing, we’re delivering the robust underwriting, loss mitigation, and claims management capabilities needed to support this transformative protection,” Madhu said.
What are your thoughts on this story? Please feel free to share your comments below.
