Workers Compensation Claims Investigations – The Essentials
Fraudulent workers compensation claims cost approximately $7.2 billion annually, according to the National Insurance Crime Bureau. That’s almost 25% of all insurance fraud and making workers compensation fraud one of the fastest growing types of fraud.
It’s tempting for workers to fabricate injuries to get time off work or permanency payments. Or for white-collar criminal activities such as doctors and lawyers falsifying information regarding a claim.
As such, managing workers compensation fraud is an important aspect of risk mitigation for your business. This is especially important if you are in a no-fault state. So, workers compensation claims investigations become essential.
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What can you do to mitigate the risk of worker’s compensation fraud?
One in four business owners has installed surveillance systems to monitor employees on the job. This was done just to mitigate the risk of worker’s compensation insurance fraud. So, that’s one way to try and reduce your exposure to fraudulent claims.
Another is not to ignore the red flags. If a claimant was in a minor vehicle accident while on the job but can’t work anymore, you might need to investigate. Where other employees might make comments or pass on information about a case, you should verify the truth to those claims.
And finally, hiring a private investigator for workers compensation claims investigations. While you won’t need a private investigator for all workers compensation claims, you should ensure to enlist one for large cases or multiple claims of the same type that may add up over time.
When should you pull in an investigator for worker’s compensation claims investigations?
If you believe you are dealing with gross exaggeration or misrepresentation, things aren’t adding up, then a second set of eyes looking at the claim is useful.
As we’ve noted, a private investigator isn’t necessary to investigate every worker’s compensation claim. They are, however, important where there are glaring red flags about a claim, or the company needs further evidence to determine the level of compensation due for a claim.
This is not to say that claims investigators are only interested in building a case that supports the employer. They are attempting to legitimize a case and prove the truth within a claim. Due diligence for eligible injuries is important to determine the level of compensation required.
So, what measures do you have in place or are using to mitigate fraudulent worker’s compensation claims in your business?