INTERNAL SURVEILLANCE CAMERAS CAN REDUCE COMP FRAUD

3Security cameras in the workplace can help employers stave off fraudulent Workers Compensation claims - as long as the companies using them are careful not to violate employees' privacy.

CEC Entertainment Inc. (Irving, TX), which operates Chuck E. Cheese's restaurants, reduced fraudulent Comp and Liability claims significantly after installing surveillance cameras in 2009 and 2010. Says CEC Director of Sales Management Jeff Strege, "We've made a number of claims literally vanish once we produce the video footage to show that what the claimant said didn't really happen."

Commercial insurance broker Marsh Inc. recommends that such businesses as retailers, manufacturers, transportation companies, and financial institution use cameras to monitor workplace safety and evaluate potential injuries as a way to monitor and validate incidents that could generate costly claims. What's more, adds Paul Braun of Aon Risk Consulting, employees who know that they're being taped will be less likely to try claims scams.

Using surveillance video can run afoul of privacy laws that prohibit companies from filming employees inside of restrooms, and require them to post signs informing workers that they're under video surveillance. In general, says Thomas Martin, CEO of Martin Investigations & Security Services (Lima, OH), "Where your eyes are allowed to see, the cameras are allowed to see."

Although cameras can't film all areas of a company, employers should look closely at Workers Comp claims that happen outside the cameras' view. Notes Martin, "If you have pretty much 75% coverage, and they happen to fall and claim an injury in the other 25%, it becomes very suspicious that (the injury) wasn't recorded."

Insurance and security experts generally agree that the cost of installing and maintaining video monitoring systems in the workplace is well worth the investment in discouraging or preventing phony - and costly - Comp claims.

We'd be happy to offer our recommendations on video surveillance security firms that can help meet your needs.

Need insurance for You, Your Family or Your Business?
We can match you to a qualified, local insurance expert!
Further Reading
An industry seminar on fraud risk, prevention and response, found 778 internal fraud cases in 2012 (more than two a day!). These scams included fake billing, corruption, and expense reimbursement. Although the companies affected suffered minimal lo...
Not every threat to your business comes from outside. A nationwide survey reported 778 internal-fraud cases in 2012, involving such scams as phony bills (three in four cases), corruption, and expense reimbursements. In more than half of these cas...
Insurers who provide workers comp understandably want to do everything possible to prevent fraud, but it can be difficult to do when claims are fraught with emotion and there's no possible way to check on every last detail of the case. Instead of jus...
What 2016 New Year resolutions are your making for your company? Consider hiring an internal control consultant to help you reach your goals.  What is an Internal Control Consultant? As a company insider, you may not be objective abo...
Every small business faces financial risks. However, you can lower your risks and improve your chances of success when you become aware of several external and internal financial risk factors. External Risks Economic Risks Economic downturns...