Understanding Workers Compensation and Fraud is a widespread and serious problem that’s not only illegal, but leads to higher insurance premiums for all businesses – including yours.
According to industry experts, comp-related scams often involve one or more of these “red flags.” Although no one sign should necessarily be cause for alarm by itself, two or more should raise suspicions and could trigger an investigation of the claim:
Common warning signs
- Monday morning report of injury. The alleged injury occurs first thing on Monday, or late Friday afternoon, but is not reported until Monday.
- Change in employment status. The reported accident occurs immediately before or after a strike, job termination, layoff, end of a major project, or the conclusion of seasonal work.
- Suspicious providers. The claimant’s medical provider or legal consultant has a history of handling dubious claims.
- Lack of witnesses. No one else saw the accident and the employee’s description does not support the cause of the injury.
- Conflicting descriptions. The employee’s account of the accident doesn’t match with the medical history or injury report.
- History of claims. The employee has filed a number of questionable or litigated claims.
- Refusal of treatment. The claimant declines a diagnostic procedure to confirm the nature or extent of the injury.
- Late reporting. The employee delays reporting the incident without a reasonable explanation.
- Elusiveness. The allegedly disabled employee is hard to reach.
- Instability. The claimant changes physicians, addresses, or jobs frequently.
If one of your workers files a claim that has some of these warning signs, be sure to let us know.
We’ll work with you and your workers' compensation insurer to check it out. For guidance on preventing and investigating questionable claims, see Workers Compensation Fraud and Employee Wellness.
If you prefer immediate assistance, you can also talk to an agent.
Frequently Asked Questions
What should I do right away if I suspect a fraudulent workers' compensation claim?
Document what you know, preserve any relevant records, and notify your insurer or claims administrator so they can start an investigation.
Can an employer investigate a claim on their own?
Employers can collect basic factual information and report concerns to their insurer, but formal investigations are typically handled by claims professionals or investigators.
Which red flags are most common?
Delayed reporting, inconsistent statements, and claims that coincide with job changes or layoffs are among the most frequent warning signs.
Will reporting a suspected fraudulent claim harm an employee with a legitimate injury?
Reporting concerns prompts appropriate review; legitimate claimants should not be penalized if the investigation confirms a valid injury.