The workers' compensation insurance system is a no-fault method of paying workers for medical expenses and wage losses due to on-the-job injuries. While the majority of workers’ comp claims are legitimate, the National Insurance Crime Bureau reports that billions of dollars of false claims are submitted each year. To help you detect possible workers’ compensation fraud, experience shows a claim may be fake if two or more of the following factors are present:
- Monday Morning: The alleged injury occurs either “first thing Monday morning,” or late on a Friday afternoon but not reported until Monday.
- Employment Change: The reported accident occurs immediately before or after a strike, a layoff, the end of a big project, or at the conclusion of seasonal work.
- Job Termination: If an employee files a post-termination claim, verify if the alleged injury was reported by the employee prior to termination. You’ll also want to check whether the employee exhausted their unemployment benefits prior to claiming workers’ compensation benefits.
- History of Changes: The claimant has a history of frequently changing physicians, addresses and places of employment.
- Medical History: The employee has a pre-existing medical condition that is similar to the alleged work injury.
- No Witnesses: The accident has no witnesses, and the employee's own description does not logically support the cause of injury.
- Conflicting Descriptions: The employee's description of the accident conflicts with the medical history or First Report of Injury.
- History of Claims: The claimant has a history of numerous suspicious or litigated claims.
- Treatment is Refused: The claimant refuses a diagnostic procedure to confirm the nature or extent of an injury.
- Late Reporting: The employee delays reporting the claim without a reasonable explanation.
- Unusual Coincidence: There is an unusual coincidence between the employee’s alleged date of injury and their need for personal time off.
- Financial Problems: The employee has tried to borrow money from co-workers or the company, or requested pay advances.
Remember, these warning signs of workers' compensation fraud are simply indicators. If you are suspicious of a claim, alert your insurance carrier.
The Mahoney Group is one of the largest independent commercial insurance and employee benefits brokerages in the U.S. For more information, contact us online or call 877-440-3304.
This article is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.