Self-insured employers often get into trouble for not being knowledgeable of the requirements of the Unfair Claims Practice Act in the state(s) where it is being self-administered for workers compensation claims. The failure to act in a totally ethical manner can lead to litigation by the party wronged and to fines and/or the suspension of the self-insured’s authorization to be self-insured by the State.
- Knowingly misrepresenting the benefits available under the state’s workers compensation law
- Failing to contact the injured employee (hoping the employee will not pursue the claim)
- Failing to investigate the claim properly
- Denying compensability without a valid reason
- Failing to file all necessary state forms
- Recording the employee’s statement when the employee is under the influence of medications or distracted by pain
- Failing to provide a copy of a recorded statement or written statement when one is requested
- Recording telephone calls without the other party’s knowledge of the call being recorded
- Knowingly documenting the file notes with inaccurate information
- Intentionally not returning phone calls of the employee or medical provider in an effort to discourage the claim
- Failing to pay indemnity benefits timely trying to coerce the employee in to returning to work prematurely
- Failing to authorize needed diagnostic testing without reason to not authorize
- Failing to pay for permanent partial disability
- Paying less than the workers comp statute calls for when settling a permanent partial disability
- Offering to settle and close out future benefits for an amount significantly less than what the adjuster knows to be fair
- Advising the employee not to hire an attorney
- Threatening to reduce the settlement of the claim if the employee hires an attorney
- Discussing any aspect of the claim with an employee known to be represented by an attorney
- Settling the claim before the extent of disability is known
- Overstating the damages and exposures so that the adjuster’s supervisor will extend excessive settlement authority, allowing the adjuster to make a quick (but overpaid) settlement
- Providing the employee’s personal information to parties who do not have a legitimate need to know
- Having a financial interest in any vendor utilized on the claim
Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.
WORKERS COMP MANAGEMENT MANUAL: www.WCManual.com
MODIFIED DUTY CALCULATOR: www.LowerWC.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
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