The Connection Magazine The Connection Magazine Spring 2017 | Page 31

“Insurance brokers can play
an active role in preventing
this type of fraud from
occurring in the first place.”
carriers.
An
excessive
number
of
certificates of insurance are
issued on a small policy.
• Reported
injuries
are
not
consistent with purported job
titles or duties.
• There is an unusual ratio of clerical
to nonclerical staff for the type of
business.
• The business avoids audits or has
never been audited.” 1
Pageler advises that the presence
of two or more of these warning signs
should cause concern to a broker.
Additionally, it is important for
brokers to protect themselves from
false accusations in the event their client
is charged with engaging in fraudulent
practices. Pageler recommends the
following:
• Maintain detailed records of your
interactions with policyholders,
including all e-mails. In the event a
policyholder is charged criminally,
your correspondence (including
e-mail) could be seized by
subpoena or search warrant.
• Verify the identity of the
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SPRING 2017
policyholder or contact person at
the policyholder’s business with a
driver’s license or other valid form
of identification.
• Obtain original signatures on all
signed applications.
If you suspect your client may be
engaging in workers’ compensation
premium fraud, do not hesitate to contact
A.I.M. Mutual Insurance Companies so we
can take action. As a broker, you provide
a crucial link between policyholders
and insurance companies. We have a
process in place to report suspected
incidents of fraud to the IFB for further
investigation. Or, if you would prefer to
report fraud directly to the IFB (and even
do so anonymously), you may submit an
online form that can be found at www.ifb.
org/ContentPages/Public/Hotline.aspx.
Workers’ compensation premium
fraud is a costly and growing problem.
However, by taking the steps mentioned
above and working together, the hope
is that we can decrease the occurrence
of premium fraud in the workers’
compensation industry and deter
business owners from engaging in fraud
in the first place.
JODI WILLIAMS is the Residual
Market Underwriting Specialist for
A.I.M. Mutual Insurance Companies.
She has a background in risk
management, compliance, and data
analysis. She also served on the Board
of Directors for a Massachusetts-
based workers’ compensation self-
insured group.
1. 6 Red Flags for Work Comp
Premium
Fraud,”
Ranney
Pageler,
InsuranceThoughtLeadership.com, Sept. 15,
2015,
http://insurancethoughtleadership.
com/6-red-flags-for-work-comp-premium-
fraud/.
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