Question :

What does the correlation of claim amount and flag for fraud at 0.86 and 1.0 respectively mean ? (See Figure 1.0 below)

The linear relationship of positive 1 shows a perfect relationship that if the claim amount increases the likelihood
of the fraud increases.

However more analysis need to be done using different Data science methods to find out the causation for fraud.

In conclusion the larger the amount of claim the more likely to be assosciated with fraud.