The Coalition Against Insurance Fraud estimates that nationwide, about $6 billion in workers’ compensation fraud is committed each year. SIX BILLION. Wow. In fact, it is the second costliest type of crime in America, after tax evasion.  It’s tough because you want to trust your employees, but unfortunately these things happen.

Workers Compensation fraud occurs when an individual stages an accident, fakes an injury, or pretends to more injured than they actually are.  Occasionally, people even claim a non-work injury happened on the job.

What can you do? To begin, establish a zero tolerance policy for fraud. There are multiple things you can implement as a business owner to help you. Train managers and upper management to spot red flags of workers compensation fraud. Establish a tip line employees can anonymously call to provide tips. Implement a fraud investigation program and alert employees that this program is in effect immediately. Consider placing cameras around the office and prosecute all fraud cases.

Even under a watchful eye, it can be difficult to determine if the incident and injury are fraud.  However, there are some red flags to consider and report to adjusters.

  • Monday morning accident. This might mean the accident occurred over the weekend.
  • Arriving early for work.
  • Not seeing a hazard that was seen earlier.
  • The mechanism for the injury doesn’t make sense.
  • The accident wasn’t witnessed.
  • The selection of a particular doctor over a more qualified doctor.
  • Tips from coworkers.

Taking precautionary steps, and courses of action when necessary will help protect you and your business in the situation on workers compensation fraud.

If you are a business owner, Bankers offers a Business Owners policy for small to medium businesses. Find more information about our policies here.


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