Why it pays to promptly report work comp claims
- The longer your insurance client delays in reporting an on-the-job injury, the more expensive that injury will most likely be.
- Help your client get the evidence early, as witnesses will forget fairly quickly what they saw.
- Learn ways lag time between an accident and filing a report.
It pays to be speedy in your workers’ comp claim reporting. Conversely, the longer your insurance client waits to report a work injury, the more expensive that injury is likely to be.
American Claims Management (our work comp claims administrator) found that when a workers’ compensation claim was reported more than 10 days after the event, costs rose by 60% on indemnity claims and 64% on medical claims.
A study by National Council on Compensation Insurance, Inc. (NCCI), as reported in Business Insurance, confirmed our findings: delayed injury reporting, it said, can increase comp claims up to 51%. The spike in costs for claims reported later may be caused by injured workers seeking attorney assistance with their claim, the report said.
Attorneys were involved in nearly 13% of claims made the same day as the accident, versus nearly 32% when claims were made four or more weeks later. That’s why it’s important for you to share these speedy workers’ comp claim reporting tips with your insurance clients.
Related: How can you improve your client’s insurance claim experience?
How fast filing of a work comp claim helps your client
1. Get the evidence. The sooner the incident is reported, the faster your client (and the claims investigator) can interview witnesses and collect evidence, and the more accurate the investigation will be. A couple of weeks after the incident, witnesses forget what they saw and the chain of events.
This is key not only in workers’ compensation claim reporting but also in risk management, to help your client assess the situation and determine what additional safeguards need to be enacted. Additionally, if there’s anything about the claim that they choose to dispute, they’ll be glad to have this early evidence.
At the same time, we in the industry understand that there’s often a likelihood of a fraudulent claim. Workers’ comp claimant fraud and medical fraud are significant contributors to our nation’s annual $30 billion insurance fraud problem. These crimes range from faked injuries while on the job in order to collect work comp, to organized crime involving crooked physicians, attorneys and patients who submit false or exaggerated claims.
Related: How to prevent workers’ compensation fraud
2. Ease employee concerns and reduce potential for litigation. Less than a quarter of U.S. employees feel strongly that their organization cares about their wellbeing, says Gallup. On the other hand, workers who strongly agree that their employer cares about their overall well-being are 69% less likely to actively search for a new job, and are three times more likely to be engaged at work. Not taking an injury seriously or not filing a claim until much later sends the message to employees that this company isn’t concerned about their employees’ well being.
Reporting the injury as soon as possible also works to ease the injured employee’s concerns, as your client is immediately providing medical care at their expense, along with explaining how the injured person will receive additional care and wage replacement payments if need be – fears that could otherwise lead them to seek attorney representation. Immediate medical care could also result in less costly physical therapy versus surgery, should the injury continue unchecked for a matter of days or weeks.
3. Safeguard employee morale. If employees know your client isn’t reporting the claim or making proper moves to protect the injured worker and guard against any future repeat of the incident, they’ll have disgruntled employees on their hands. That problem will only escalate. Making it clear that the injured worker is receiving the medical care they need often results in his or her being willing to return to work more quickly, even in a light duty role.
4. Avoid fees and penalties for late filing. Every business is required to report workplace injuries, illnesses and deaths to OSHA and their own state’s workers’ comp division. Failing to do so within its state’s allotted timeline can result in significant penalties and in some cases, thousands of dollars in fees, says Property-Casualty 360.
Under- and improper reporting of work comp claims is also a significant problem. OSHA reports that approximately half of serious work-related injuries and fatalities aren’t reported; many of those responsible for under-reporting are small to mid-sized businesses which likely didn’t understand their reporting requirements.
“Business owners need to understand the laws and put an injury-reporting process in place prior to any workplace accidents. This will not only help keep the company within the claims reporting window and avoid fines, but will also help reduce the under-reporting gap,” the PC360 article concludes.
How to reduce the lag time for workers’ comp claim reporting
Few employers have trouble reporting a more serious work comp claim, because the injured worker obviously needs immediate care, and it’s clear when and where the injury occurred. It’s those smaller claims that typically go unreported at first, where the employee seems to be fine and can initially shake off the incident. Here are a few tips to consider:
- Discuss and encourage early reporting with your clients.
- Ensure their supervisors and employees understand how to report an injury and who their point of contact is (along with a back-up person). At the same time, assure employees that your goal in the event of an injury is to help them return to work as quickly as they’re able, showing your long-term commitment to them.
- Make certain that supervisors know how to use their incident report. Encourage your work comp clients to conduct a series of brief five-minute trainings during staff meetings to walk through the report, explaining what information is needed and the importance of being detailed.
- Remind clients that if they enact strict workers’ compensation claim reporting deadlines, they shouldn’t punish employees for reporting “late” if they genuinely may have thought the injury would heal itself. This may push the employee towards hiring an attorney; instead, review these on a case-by-case basis.
- For a minor incident that doesn’t look like it will become a full-blown claim, it’s still best to report it in “report-only” mode, which alerts us to the accident without turning it into a formal claim. This actually protects you if and when it does become a more serious claim.
Reporting an injury within 24-48 hours is optimum, experts agree. Our collective goal – your carrier’s, our claims manager’s and your own – is a speedy recovery for an injured worker, and prompt reporting gets us all on that road to recovery much faster.
Related: How effective is your client’s return-to-work program?
Agents, take a look at our Workers’ Compensation Program to add to your portfolio of insurance solutions.
This article first appeared in Arrowhead’s Tribal blog. It has since been edited and revised to better fit the needs of Arrowhead’s workers’ compensation producers and their clients.