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4 Types of Workers Compensation Fraud Employers Should Be Aware Of

4 Types of Workers Compensation Fraud You Should Be Aware Of

Workers compensation fraud is a large percentage of insurance fraud in the US. You should, therefore, implement measures to defend against fraudulent claims and to mitigate fallout.

To put in place systems to bolster your risk management program, you first have to understand the types of workers compensation fraud that are most prevalent in the industry.

1. Fabricating the accident

This is outright lying about an incident at the workplace to claim workers compensation. It can range from staging accidents at work to working with medical professionals to give inflated invoices for unnecessary procedures.

Thorough investigations are necessary to be able to determine the accuracy of these claims. Putting in surveillance cameras that cover all areas of the property is also one of the few measures to limit fabricated accidents.


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2. Working when they say they can’t

Another popular method of workers comp fraud is employees claiming for workers comp for inability to work while being employed elsewhere. This may not easily show up in the records because they can be paid cash only/under the table to prevent investigators from finding out.

3. Lied about past medical issues

This is one of the most popular attempts at workers compensation fraud. Employees will lie about previous medical conditions that may impact a current issue. Or, they will lie about receiving treatment for or experiencing an accident that resulted in an injury in the past for the issue they are now trying to claim.

A comprehensive incident report form and getting previous medical doctor’s records can help with dispelling these lies.

4. Exaggeration of the scope of the injury/incident

While not exactly a fraudulent activity, it is still something you should be aware of. Employees may exaggerate the level of their injury to influence the size of the workers’ compensation benefits they can claim.

So, are you prepared in your business to mitigate the risks of these fraudulent claims on your earnings?

Whether it’s private sector, public sector, or commercial business, you must take funds from somewhere to cover workers comp claims. So, make sure they are legit claims. And if you want help in putting in mitigation strategies to handle workers comp claims, give us a call.