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Workers compensation defense protects employers from fraud

Although the total number of workers' compensation claims has dropped nationwide, the numbers of questionable workers' compensation claims have been rising. California is a leader in the department of questionable claims, according to a report published by the National Insurance Crime Bureau (NICB), a nonprofit company supported by more than 1,000 insurance companies. These figures explain and support why employers must present a workers' compensation defense in many cases.

The number of workers filing compensation claims dropped from 3.35 million in 2011 to 3.24 million in 2012, according to the NICB. Based on the figures for the first half of this year, the number will drop again, the bureau said. But the bureau reported an increase in questionable claims from 3,474 in 2011 to 4,460 in 2012, and will likely rise again in 2013, the bureau reported.

California tops all states with the highest number of questionable workers' compensation claims each year, but when measuring claims per 100,000 residents, Delaware, Connecticut and Maine ranked first for 2011, 2012 and first half of 2013 respectively. The city with the largest number of questionable claims in 2011 was Chicago. Los Angeles was first in 2012 and for the first half of 2013.

Questionable claims and workers' compensation fraud cases are marked by workers faking or exaggerating injuries, or filing for injuries that did not take place at work, the report said. In many cases, an insurer must present a workers' compensation defense to obtain sufficient facts and medical evidence to make a final decision regarding an apparently questionable or borderline claim. In California, with the highest numbers of questionable claims being filed, an insurer must be vigilant to present a workers' compensation defense on behalf of the employer in any case where the facts tend to indicate exaggeration, deception or faking of injuries. Some of these are eventually paid after additional fact-finding and medical examinations verify that the claim is substantially valid.

Source: Los Angeles Times, Questionable workers' compensation claims on the rise, study finds, Hugo Martin, Sept. 24, 2013

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