Worker’s Compensation fraud is the second costliest crime in America second to tax evasion.  The total costs to insurers is difficult to nail down but ranges in scope from $6 billion/year (Coalition Against Insurance Fraud) to $7.2 billion /year (National Insurance Crime Bureau) and as high as $30 billion/year (Insurance Information Institute).

The most common questionable claim involves employee fraud falling into one or more of several categories:

  • Remote injury- workers gets injured when they are not working, but report that the injury occurred in the course of completing their job duties.
  • Exaggeration of injuries – worker receives a minor injury while working and reports a more serious injury.
  • Faking injuries – workers fabricate an injury that never happened
  • Old injury – worker had a previous injury that never quite healed and reports it as a new, work-related injury
  • Malingering – worker has healed from the original injury but claims that injury still prevents activity

In order to assess a claim, one must determine the number and scope of Questionable Claim Indicators (QCI) present.  A QCI is a red flag on a claim that could signal possible abuse.  The presence of one QCI may not be of import; the presence of several would constitute employee fraud.  

Questionable Claims Indicators can fall into one or more of four categories:

  1. Employment- These indicators relate to job duties and schedules of the employee including the timing of when worker’s compensation claims are filed.
  2. Behavioral – These indicators relate to how the claimant acts (actions); what the claimant says (statements)
  3. Medical – These indicators relate to the injury itself, treatment and recovery
  4. Personal/Financial – These indicators relate to the claimant’s financial status and to anything outside of the claimant’s work life; family, friends, witnesses; hobbies; other jobs

The following are common Questionable Claim Indicators to consider when reviewing a worker’s compensation claim, some of which were taken from The Insurance Fraud Casebook: They are categorized by category.  Some QCIs will fall into more than one category.


  • The accident/injury reportedly occurred late Friday or early Monday morning, indicating that it could have actually occurred during the weekend (during off hours).
  • The claimant is a new employee, disgruntled, on probation, facing layoff, about to retire or had been passed over for a promotion
  • There were no witnesses to the accident/injury
  • The injury was reported only after the claimant sought medical treatment
  • The claimant is injured after giving notice
  • The claimant waited days or weeks before reporting the accident or injury


  • The incident report and the medical evaluation contain conflicting information
  • The claimant refuses or delays treatment to diagnose the injury
  • The claimant misses physical therapy, occupational therapy or other doctor’s appointments
  • The injury itself is subjective (soft tissue, emotional, chronic pain )
  • The claimant left the country to secure medical treatment
  • The claimant and other workers from the same employer use the same attorney, doctor, chiropractor or clinic
  • The injury relates to a pre-existing health problem
  • The claimant changes doctors frequently


  • There are no witnesses to the reported accident or injury; or the only witness is someone with a close friendship or tie to the claimant.
  • The claimant and witness statements offer conflicting information OR they are too similar (almost verbatim) as if rehearsed.
  • The claimant has financial problems or is going through a divorce
    (child custody battle)
  • The claimant is “living large” on a supposed modest income; living beyond their means
  • The claimants’ co-workers express doubt about whether the accident or injury actually happened
  • The claimant has a part-time job that is labor intensive
  • The claimant’s family knows nothing about the claim or they are overly helpful to the point of sounding rehearsed
  • The claimant’s family members are on worker’s compensation or have a litigious history
  • The claimant is involved in physical hobbies or sports
  • The claimant is involved in home repair (DIY) or auto repair
  • The claimant just had a new baby or has preschool age children



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full service investigation firm.

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