20 Unfair Claim Practices For Your Adjuster To Avoid

The workers compensation adjuster, who is often dealing with attorneys out to maximize the cost of the workers comp claim, or with employee claimants who are attempting to commit fraud, may be tempted to fight fire with fire. The adjuster should always handle the claim in a totally ethical manner.  If an adjuster is doing any of the following, stop everything and discuss the adjuster’s actions with the adjuster.



Unfair claim practices by the adjuster include:


  1. Failing to contact the injured employee (hoping the employee will not pursue the claim)
  2. Failing to investigate the claim properly
  3. Denying compensability without a valid reason
  4. Failing to file all necessary state forms
  5. Recording the employee’s statement when the employee is under the influence of medications or distracted by pain
  6. Failing to provide a copy of a recorded statement or written statement when one is requested
  7. Recording telephone calls without the other party’s knowledge of the call being recorded
  8. Knowingly documenting the file notes with inaccurate information
  9. Intentionally not returning phone calls of the employee or medical provider in an effort to discourage the claim
  10. Failing to pay indemnity benefits timely trying to coerce the employee in to returning to work prematurely
  11. Failing to authorize needed diagnostic testing without reason to not authorize
  12. Paying less than the workers comp statute calls for when settling a permanent partial disability
  13. Offering to settle and close out future benefits for an amount significantly less than what the adjuster knows to be fair
  14. Advising the employee not to hire an attorney
  15. Threatening to reduce the settlement of the claim if the employee hires an attorney
  16. Discussing any aspect of the claim with an employee known to be represented by an attorney
  17. Settling the claim before the extent of disability is known
  18. 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
  19. Providing the employee’s personal information to parties who do not have a legitimate need to know
  20. Having a financial interest in any vendor utilized on the claim



Mistakes, Oversights, & Poor Claim Handling Are Not Unfair Claims Practices 


Mistakes, oversights, and poor claim handling are not unfair claims practices. The workers compensation adjuster often has more work to do than it is possible to get done. With the telephone ringing constantly, the e-mail flooding in, having numerous deadlines for filing forms, numerous deadlines to prepare for mediations or conferences, and numerous other items that need to be completed, it is normal for some things to fall through the cracks. When the adjuster does not contact the injured employee timely, or does not respond to a settlement demand from the employee’s attorney, it is normally because the adjuster has more to do than is possible to get done. It only becomes an unfair claims practice when the adjuster intentionally decides not to take a needed action in an effort to impact the overall outcome of the claim.



Almost all adjusters are honest and have the best interest of both the employee and the employer at heart. If you do notice any of the above issues occurring, stop and discuss the issue with the adjuster. Often there is an ethical and valid reason for the adjuster’s action which will become apparent when you learn more about the reason for the adjuster‘s actions. Only when the adjuster sets out to act dishonestly should you be greatly concerned.



Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@reduceyourworkerscomp.com.


©2016 Amaxx LLC. All rights reserved under International Copyright Law.


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.



  1. Fight fire with fire? 20 plus years in the business with multiple, major carriers and TPAs and I’ve never been witness to any of the 20 listed, that was intentional. I’m really shocked at all the bad press that seems to try and represent minority issues as illustrations of the overall system. All of the adjusters who have worked for me have been both ethical and hard working but they expect the claimants to be ethical as well. When that is not the case, they know it’s up to the state agency that handles WC to address it and not them.

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