As the fastest growing insurance fraud in America, workers claimant fraud is one way employees may seek to make the most of an opportunity. Employee fraud in workers compensation claims can lead to serious consequences for your organization. It can increase overall claim-related expenses, through the complex investigation process, and raise your workers comp insurance premiums due to associated risk factors. Besides coverage ramifications, employee fraud can also affect the overall success of your organization, damaging your organization’s reputation and impacting your client relationships. These troubling claims may cause potential investors, shareholders, or even future contracts to be in question. You’ve worked so long to build your business, it would be disastrous for a fraudulent workers comp claim to threaten your most cherished asset.
The key to avoiding such destruction is to put in place effective preventative fraud measures that safeguard your business and dissuade any fraudulent actions. Business Insurance Center breaks down some simple steps that you can take to avoid employee workers comp fraudulent claims.
How to Avoid Workers Comp Fraud
Are you now wondering “how do I protect my business against workers comp fraud”? That’s the spirit! There are a number of ways to help prevent employee insurance fraud by taking precautionary measures and making informed decisions that best protect businesses against employee workers comp fraud.
1. Educate Your Employees About Workers Comp Fraud
During any meeting, routine training, or group session, take the opportunity to inform your staff about workman’s compensation fraud. Teach them the ins and outs of workers compensation. You’ll have peace of mind knowing that your staff are trained on how to properly file a claim, what isn’t covered by workers comp, and how fraudulent workers comp claims negatively affect a business. It also lets employees know that you’re aware and safeguarding against such false claims. Additionally, if employees are instructed to report any work illness or injury immediately, they are less able to make a false workers comp claim (the issue is treated more quickly and cannot escalate into a more serious condition). Open communication often discourages fake workers compensation claims.
2. Hire Trustworthy Employees to Avoid Workers Comp Fraud
During the hiring process, apply well-established screening systems such as criminal background checks and contact with references (and prior employers). These measures can help you choose employees who are unlikely to engage in criminal behavior. Another element of the hiring process should be an assessment to determine if the candidate is capable of performing any physical requirements for the job. When you hire the right people for the right job, it decreases the likelihood of a workers comp claim in general, while also making it less likely that they’ll be able to successfully fake an injury or illness.
3. Use Risk Management Strategies to Prevent Fraudulent Workers Comp Claims
Having a workplace safety plan and strategies that are beyond reproach increases the likelihood of employee safety. Implementing a successful and encouraging return-to-work program also supports employee happiness, health, and safety. This both limits workers’ compensation claims and keeps costs low when claims occur, making it more difficult for employees to engage in fraud.
4. Asses Workers Compensation Claims Carefully
Establish a diligent and thorough process for assessing workers’ compensation claims. This will help you to detect illegitimate workers comp claims and help deter employees from attempting fraud.
Protecting Against Workmans Comp Fraud
If this unfortunate situation does occur within your organization, there are steps you can take to minimize the damage. After all, employee workmans comp insurance fraud is illegal and your employee will face ramifications if found guilty of committing fraud, including civil penalties, court injunctions, and criminal charges. Thus, it’s vital to report suspicions as quickly as possible and determine if the claim is indeed fraudulent.
How to Report Workers Compensation Fraud
If you suspect that employee workers compensation fraud is happening at your organization, report your suspicions to your claims adjuster immediately. The claims adjuster has a handful of tools at their disposal to help determine if an employee’s claim is legitimate, fraudulent, or requires corrective action.
What to do about Employee Workers Comp Fraud
Together with your insurance claims adjuster, you can work to determine if your employee is making an illegitimate workers comp claim by:
-Having a case manager visit the employee randomly
-Analyzing all the medical records
-Requiring an independent medical examination of their injury or illness
-Surveilling the employee through video or social media
Hopefully these tips from the Business Insurance Center on workers compensation fraud protection have helped! It’s always most beneficial (and cost-effective) to deter false workers comp claims from the start – and now you know how!
