Avoiding Fraud in the Workplace
Approximately 10% of all U.S. adults believe it is proper for someone injured in a non-job-related activity to claim the injury is work-related in order to collect workers' comp benefits.
According to the National Insurance Crime Bureau (NICB), not only does workers' comp fraud cost the insurance industry nearly $5 billion annually, but this type of fraud also costs American businesses billions of dollars each year in higher premiums and other expenses including production delays, retraining costs, and equipment replacement costs.
Workers' comp laws vary from state to state, with most states requiring 100% payment of medical and rehabilitation expenses for employees injured on the job, and up to two-thirds of the employee's wage-loss benefits while he or she is unable to work. With these percentages, the growth of false and exaggerated claims is making workers' comp fraud one of the fastest growing segments of insurance fraud.
One of the best ways to control your workers' comp costs is to control the frequency of all insurance claims, both legitimate and fraudulent. A well-organized safety program in your office can mean the difference between a safe working environment and a lawsuit..
The NICB offers these steps in avoiding workers' comp fraud:
Screen employees before you hire them. Check references and job information.
Provide all new hires with a written statement of your company's workers' comp policies, and a separate statement concerning safety.
Inform workers that money for injuries ultimately comes from the employer, which in turn, reduces raises and affects the company's ability to compete in the marketplace.
Use a fraud prevention employee exit interview, and have terminated employees sign a form attesting they have not been injured in your workplace.
Display fraud awareness and prevention posters in your workplace, as well as the NICB hotline number – (800) TEL-NICB.
We are pleased to provide this "Bulletin" as a service to you. While this information was obtained from sources believed to be reliable, its accuracy is not guaranteed. It does not change or alter insurance contracts or coverages.
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