Workers Comp Fraud – Why I Skip the Subject (Usually)


I am sometimes asked during presentations, at conferences, or just in general conversations why I rarely cover Workers Comp fraud in the 2,000 articles on this website.  I have covered fraud in a few instances over the last 15 years.  See the list at the end of this article for more info or click on the category for a full listing.

Workers Comp Fraud – The Unknown Variable

According to a PBS article, a study in 2000 showed that fraud cost employers $1.2 billion.

According to the National Insurance Crime Bureau,  Work Comp fraud in 2017 cost employers $30 billion per year.  I am not sure how that figure was calculated or estimated as a yearly figure.

Did this figure grow from $1.2  to $30 billion in 17 years?  As one of the components of fraud is concealment, I am not sure we know exactly how much it costs employers.

pic of workers comp fraud miracle cure bottlePublic Domain –

Definition and Types

Workers Comp fraud occurs in many versions – the five I have listed are:

  1. Employer
  2. Employee
  3. Provider
  4. Claims Department -rare, but it happens
  5. Agency – usually fake agents or keeping premiums and not procuring policies


Let us look at a dictionary’s definition of fraud at the Free Dictionary.   The Free Dictionary tends to define any word or term very thoroughly.  Check out the prior link for the dictionary I surf often if I need a quick definition or a more thorough one than most online dictionaries.

A false representation of a matter of fact—whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed—that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury.

Employer/Employee/Provider Workers Comp Fraud

Why do I not cover these three types of fraud? Many publications cover these three types of fraud to the nth degree.  Check out; WorkCompCentral; Insurance Journal: and Business Insurance for in-depth coverage of fraud.

I could easily fill this website full of fraud-based articles.  Why cover what other publications cover so well?  Some of the publications I mentioned have sections devoted to fraud.

I Googled the term “workers comp fraud” just now.   Three TV stations were covering a restaurant owner in Texas who was indicted for fraud.  Businesses accused of Workers Comp fraud seem to make the news very often.

Check out these other articles from J&L on workers comp fraud.  You can click on the category in this article for a listing of all the articles.

Workers Compensation Fraud In New Jersey – Video Says It All

Workers Comp Premium Auditor Fraud Is Hard To Detect

Workers Compensation And National Insurance Crime Bureau 

Insurance Buyers Swindled In Multinational Scam

This blog post is provided by James Moore, AIC, MBA, ChFC, ARM, and is republished with permission from J&L Risk Management Consultants. Visit the full website at

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