An old saying goes cheaters never prosper. Maybe not. But cheaters sure mess it up for the rest of us. If you’re an employer looking for cheap workers compensation insurance, you can thank the fraudsters among us for rising premiums. But, you can also fight back to lower your workers compensation insurance quotes.
Workers compensation insurance fraud is not a victimless crime. Far from it. The National Insurance Crime Bureau estimates the cost of workers comp insurance at around $5 billion annually. Businesses foot that bill directly in the form of higher premiums, but the impact extends to every single individual.
You don’t need to be an Einstein to figure that out. Every dollar your workers compensation insurance company has to pay out for fraudulent claims or to investigate and prosecute a fraudulent case is passed along to you, the employer. That means you have to make up for the increase by adjusting wages, adjusting your hiring practices and/or raising the prices of your goods and services to Joe Consumer. See, there are plenty of victims to go around in workers comp insurance fraud.
Here are some of the ways you can help prevent fraud in the workplace:
Watch for red flags when claims are filed. These might include accidents that happen on Mondays that might actually be the result of a weekend off-the-job accidents; claims filed by disgruntled employees seeking revenge; no witnesses to corroborate a claim; or a shift in the claimant’s story depending on whom he or she is talking to. One of these alone isn’t proof of fraud, but it is a reason for further investigation.
Take great care in your hiring practices to weed out potential serial workers comp insurance fraudsters. Prolonged, unexplained gaps in employment or a pattern of frequent job changes should be scrutinized and verified.
Have documented workers comp insurance policies. Educate your workers and management about the hard costs of fraudulent claims and their impact on the company’s (and the employees’) financial well-being.
Instigate workplace safety programs.
Prominently post hotline numbers where employees can anonymously report suspected fraud to your workers compensation insurance provider or your state’s insurance commission’s fraud detection unit.
Doing your part can help minimize the financial impact of fraud and could even result in cheap (or at least cheaper) workers compensation insurance quotes.