Worker’s comp fraud $300 billion national problem

The Illinois State Insurance Department receives reports of six alleged cases of workers’ compensation insurance fraud each week, according to Director Michael McRaith.

Some reports accuse employers of fraudulently denying claims, while others accuse employees of exaggerating injuries. Other reports accuse insurance companies of unjustly raising the rates on workers’ compensation insurance, said McRaith, director of the Illinois Division of Insurance.

No matter who’s at fault, the fraud is increasing the cost of workers compensation insurance, he said.

“Illinois business owners simply pay too much for workers’ compensation insurance premiums,” said McRaith, speaking at a breakfast in Bloomington, Ill. “Insurance fraud is a $300 billion national problem.”

McRaith said a new proposed Illinois act would appropriate $900,000 for a Workers’ Comp Fraud Unit in 2006.

Source: S. Miller, Bloomington Pantagraph