Workers’ compensation insurance is a critical safeguard for contractors, ensuring that injured employees receive medical care and wage replacement. However, fraudulent claims by employees can drive up insurance costs, increase scrutiny from insurers, and damage a company’s reputation. As a contractor, understanding the warning signs of workers’ compensation fraud can help you protect your business from unnecessary losses. Below are ten signs that an employee may be committing workers’ comp fraud.
1. Delayed Reporting of the Injury
Legitimate workplace injuries are typically reported immediately or as soon as it’s safe to do so. When an employee waits days or even weeks before informing their employer of an alleged injury, it raises suspicion. Delayed reporting can indicate that the injury may not have happened at work or that the employee is attempting to exaggerate a minor issue. Contractors should have clear policies in place requiring immediate injury reporting and documentation.
2. No Witnesses to the Incident
If an employee claims to have suffered an injury on the job but no one witnessed the accident, it can be difficult to verify what really happened. While not every workplace injury has direct witnesses, patterns of unwitnessed incidents—especially in areas with active foot traffic—should raise a red flag. In these cases, thorough investigation and surveillance footage review can help determine the legitimacy of the claim.
3. Inconsistent or Changing Stories
Workers’ compensation fraud often involves fabricated or exaggerated claims, and one of the easiest ways to spot deception is through inconsistent accounts of how the injury occurred. If an employee’s story changes when speaking to different people—such as their supervisor, the insurance adjuster, or a medical professional—it may indicate dishonesty. Keeping detailed written records of every report can help identify discrepancies.
4. Injury Occurs on a Monday or After a Holiday
A surprising number of fraudulent claims involve injuries reported on Monday mornings or after a long weekend. This pattern suggests that the injury may have actually occurred off the job, but the employee is attempting to pass it off as work-related to collect workers’ compensation benefits. Contractors should take special note of these claims and ensure thorough investigations are conducted.
5. The Employee Has a History of Workers’ Comp Claims
While some workers genuinely sustain multiple injuries over time, an employee with a history of frequent workers’ compensation claims should be carefully scrutinized. Serial claimants may be abusing the system to receive benefits without legitimate injuries. A claims history review can reveal whether an individual has a pattern of questionable claims.
6. Refusing Diagnostic Testing or Treatment
When an injured employee avoids medical tests that could confirm the severity of their condition—such as MRIs, X-rays, or independent medical examinations—it may indicate fraud. Fraudulent claimants often exaggerate symptoms but avoid objective medical testing that could contradict their claims. Contractors should work with their workers’ compensation insurer to ensure injured employees comply with required medical evaluations.
7. The Employee is Difficult to Reach While on Leave
A legitimately injured worker will usually keep in touch with their employer about their recovery process and return-to-work timeline. However, fraudulent claimants may become difficult to reach, fail to return phone calls, or avoid check-ins. Some may even be working another job while collecting benefits. Surveillance and social media investigations can sometimes uncover fraudulent activity.
8. Inconsistent Medical Reports
Medical professionals play a key role in verifying workplace injuries, and discrepancies in their reports can be a warning sign of fraud. If one doctor states the employee has a serious injury while another finds only minor issues, the employee may be exaggerating their symptoms. Contractors should work with insurers who have access to medical fraud detection tools and independent medical examiners.
9. The Employee is Seen Doing Activities That Contradict Their Injury Claim
One of the clearest signs of workers’ compensation fraud is when an injured worker is caught engaging in physical activities that contradict their alleged injury. For example, an employee claiming a serious back injury but later being seen lifting heavy objects or playing sports is highly suspicious. Private investigators and social media monitoring can often reveal fraudulent behavior.
10. Financial or Personal Motives for Fraud
Employees facing financial hardship, legal troubles, or job dissatisfaction may be more likely to commit workers’ compensation fraud. If a worker suddenly files a claim after being denied a promotion, facing disciplinary action, or experiencing personal financial difficulties, their motivation should be carefully considered. Contractors should stay vigilant and report any suspicious claims to their insurance provider.
BGES Group: Your Trusted Partner for Workers’ Compensation Coverage
If you suspect workers’ compensation fraud in your company, having a strong insurance partner is essential. BGES Group is a construction insurance specialist serving New York, New Jersey, and Connecticut. We understand the unique challenges that contractors face with workers’ compensation and provide tailored solutions to help protect your business from fraudulent claims.
At BGES Group, we work with top-rated insurance carriers to secure the best coverage at competitive rates. Whether you need new workers’ compensation insurance, help with risk management, or assistance in handling a questionable claim, our team is here to support you. We have programs designed specifically for contractors, including those in higher-risk trades like roofing, demolition, and masonry.
Need New Workers’ Compensation Insurance? Contact BGES Group Today!
Don’t let fraudulent claims drive up your insurance costs and put your business at risk. BGES Group specializes in workers’ compensation insurance for contractors and can help you find a better policy at a lower cost. Contact us today to discuss your coverage needs and get expert guidance.
Contact Information: • Phone: 914-806-5853 • Email: bgesgroup@gmail.com • Website: www.bgesgroup.com
BGES Group is your trusted partner for construction insurance in the Tri-State area. If you need workers’ compensation insurance that protects your business from fraud and unnecessary expenses, give us a call today!