Worker’s Compensation Fraud – 15 Signs to Watch Out For

by Chuck on Jun 27, 2013

Worker’s Compensation (WC) is a wonderful benefit that pays workers for medical expenses and lost wages due to on-the-job injuries. Ask anyone who’s ever had an accident on the job just how much of a positive impact WC insurance had on them and their recovery.


But, as with any system that offers benefits, there are those who would take advantage of the system. Granted most claims that are submitted annually are truthful and legitimate, but according to the National Insurance Crime Bureau, billions of dollars of false claims are submitted each year. That’s a lot of money that could be used for those who really need it.


So, what signs should you look for when an employee submits a claim for an on-the-job injury? If any two of the following points are present, the claim may be fraudulent and you will want to investigate it further.


  1. Monday Morning – If the alleged injury occurs either first thing on a Monday morning or late on a Friday and isn’t reported until Monday.
  2. Employment Change – The reported accident occurs immediately before or after a strike, layoff, or at the end of a large project or conclusion of seasonal work.
  3. Job Termination –If the claim is filed after the employee has been terminated:
    1. Was the alleged injury reported prior to termination?
    2. Did the employee exhaust their unemployment benefits prior to claiming WC benefits?
    3. History of Changes – The Employee has a history of frequently changing physicians, addresses and places of employment.
    4. Medical History – The employee has a pre-existing medical condition that is similar to the alleged work injury.
    5. No Witnesses – There are no witnesses to the accidents and the employee’s description of the event does not logically support the cause of the injury.
    6. Conflicting Description – The employee’s description of the accident conflicts with the medical history or the first report of the injury.
    7. History of Claims – The employee has a history of numerous suspicious or litigated claims.
    8. Treatment Refusal – A diagnostic procedure to confirm the nature or extent of the injury is refused.
    9. Late Reporting – The employee delays reporting the claim and doesn’t have a reasonable explanation for the delay.
    10. Hard to Reach – You have difficulty reaching the employee at home while they are allegedly disabled.
    11. Moonlighting – Does the employee have another paying job or are they doing volunteer work?
    12. Unusual Coincidence – The alleged date of the injury coincides with the employees’ need for or requested personal time off.
    13. Financial Problems – The employee has tried to borrow money from co-workers or the company, or has requested pay advances.
    14. Hobbies – The employee has a hobby that could cause an injury similar to the alleged work injury.


The above are just some guidelines to help you determine if you need to be suspicious of a worker’s compensation claim. As with any insurance question, contact your independent insurance agent for guidance, information and as an alert in case the claim seems to be fraudulent.