Billions of dollars in premiums are collected by insurance companies that provide Workers’ Compensation Insurance coverage to businesses and municipalities of all sizes. Premiums are predicated upon the risk within a specific category of work being performed. As an example, a clerk would not be considered a high risk while a construction worker who works on high rise buildings would be a high risk. In other words the more likely to be injured on the job the higher the premium. However, that is not the problem within the Workers’ Compensation Insurance industry. The problem lies with fraud.
The Beginning of Workers’ Compensation Fraud Investigations
Back in 1991 our CEO Robert Mann of Worldwide Intelligence Network first started to investigate alleged fraudulent Workers’ Compensation cases the insurance industry in California was burdened with thousands of claims. Employees were filing claims to collect a check every month without having to work for living. Stress was the most frequent claim and all an employee had to do back then was say they were too stressed to work and then they would find themselves an attorney to file their claim for them and offer to give the attorney a percentage of what they collected. Then the attorneys would refer these fraudulent claimants to doctors that would verify that the claimant was simply too ill to return to work due to stress on the job. The claims back then were off the wall and at that time, Hughes Aircraft was the largest employer in the state of California. Hughes lobbied Sacramento heavily to have the legislature pass a law that quantified what constitutes an actual work related stress claim that realistically was actually caused by an employee’s work environment. A new law was passed that rid the claimants’ ability to simply claim stress due to their work place. Once the new law was passed medical clinics that specialized in Workers Compensation medical claims were shut down all across the State as were the law firms that perpetrated fraudulent stress claims with the Workers Compensation Appeals Boards up and down the state. District attorneys were called upon to form a special division to prosecute those who were perpetrating fraud upon the State’s insurance companies.
Claims went from 85% to 5% within a year and eventually the insurance industry was able to reduce the Workers’ Compensation insurance premiums to business owners and municipalities and businesses grew exponentially. Here we are in 2013 and it appears that we are nearly right back to where we were in 1991. Claims are being filed like crazy because so many employees have been laid off or fired due to the economy and they fear their unemployment insurance won’t be able to sustain them until they find gainful employment. Our job here at Worldwide Intelligence Network is to fairly investigate suspected fraudulent claims and report our findings back to our clients, the Workers’ Compensation insurance companies. It’s a never ending battle between the good and bad in this country. When businesses are forced to pay increased premiums while struggling through surviving a very difficult an economy it slows the growth of our economy not only here in the USA but around the world. We actually need much stricter laws dealing with fraudulent claims.