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Understanding Workers’ Compensation Fraud Part 1

Workers’ compensation fraud is a growing problem in the nation and is especially prominent in industries with a high risk of injury like construction. Workers’ compensation is among the most common types of insurance fraud and billions of dollars are shelled out annually in disability payments. Many of these payments stem from bogus claims. Although insurance companies do their best to detect insurance fraud, the act of defrauding insurers continues.

One of the reasons why workers’ compensation fraud has become so prevalent is because many different parties can commit this illegal action, including employees, employers, and even health care providers. In this two-part article, a workers’ compensation defense attorney in Florida will discuss some common ways that employers and employees violate these laws.

How Employees Cheat the System

The most common way that an employee can commit workers’ compensation fraud is by reporting an invalid claim stemming from an injury. There are a variety of ways a worker can create a false claim, including:

  • The worker was injured over the weekend, away from the jobsite, or off the clock
  • The worker was never injured
  • The worker was injured without a witness
  • There was a delay between the worker seeking treatment and the alleged injury
  • There was a delay between the worker’s injury and reporting the incident
  • The worker was terminated right before their injury
  • The worker alleges they are injured, but has another source of income they collect while away from the jobsite
  • The worker filed multiple claims

How Employers Cheat the System

Although workers’ compensation fraud often has a stigma of being performed by workers faking an injury, the reality of the situation is that many employers willfully violate these laws. Employer fraud can occur a variety of ways, including:

  • Worker misclassification is a common issue in construction as a construction business owner will try to cut corners by refusing to purchase insurance for their workforce
  • Many employers will deny a valid claim by a worker as they don’t want to compensate the worker for their medical bills and time seeking treatment away from the jobsite
  • Some employers will ostracize workers that file claims
  • Whether it’s a ghost policy or shell corporation, there are many sophisticated and illegal ways some employers will try to avoid paying employees’ insurance claims

For more information on workers’ compensation fraud, please read part two, where a workers’ compensation defense lawyer in Florida will go into more detail of the ways workers’ compensation fraud can be investigated by a government agency, an insurance company, or a third party investigator. We will also offer employers a few tips for ensuring they are compliant with the laws related to workers’ compensation insurance.

If you would like to speak with our workers’ compensation defense attorneys in Florida, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.