One of the best fraud fighting tools is provided by the Central Index Bureau report, a division of the Insurance Services Office. It is known as a Central Index Bureau report, a CIB report, an ISO, or as a claim index. The terminology varies from insurance company to insurance company. Regardless of the name, the CIB is a basic record of the insurance claims filed by an individual. What makes it effective is it is one of the very few areas where insurance companies share information.
Over 90 percent of all insurance companies are members of the ISO Central Index Bureau. Be sure your insurer is a member too. If not, the insurance company may be paying fraudulent claims which will have an adverse impact on workers’ compensation insurance premiums.
Information Reported to Central Database On Every Claim
When one of the employees files a workers compensation claim, the basic information about the claim and the claimant (employee) is obtained. The CIB report will contain the claimant’s name, social security number, maiden names, aliases or former names if known as well as address, former addresses if known, occupation, and date of birth. The CIB report will include the accident location, the date of the accident and the alleged injuries. It will identify the type of injury whether it is automobile bodily injury, general liability bodily injury, automobile medical payments or PIP, workers compensation, homeowner’s liability, medical malpractice, or a non-occupational disability claim.
The report will identify the medical provider by name and address as well as the lawyer’s name and address if the claimant is represented. The report will also contain the adjuster’s name, the name of the insurance company (or third party administrator), the insurance company’s address, and even the adjuster’s phone number. It identifies who the insured is for the insurance company and the insured’s address.
Protect Yourself From Paying For Prior Injuries
Why is all this information reported to the insurance services office on every insurance claim, including property claims? The reason is to protect the insurance company from paying for a prior injury. The claimant’s attorney is not going to tell the insurance adjuster that he has previously represented Mr. Bad Luck on his five previous injuries, two auto accidents, one slip and fall, and two workers compensation claims against five prior insurance companies.
Example: Employee Sustains Injury Every Deer Hunting Season
Take the example of Mr. Bad Luck. When the workers compensation adjuster interviewed Mr. Luck, he stated he was in excellent health, had never had a real injury before, but now he severely injures his back. The adjuster is alert. She electronically files the Central Index Bureau report and receives an electronic report that lists all the information on Mr. Bad Luck, even though his social security number was changed 3 times and his address four times. Suddenly the claimant has selective memory about previous injuries.
In one claim file audit of governmental pool‘s workers compensation claims, the auditor notices the adjuster has received 18 hits (prior injury claims) on one unfortunate employee. The employee was employed 17 years with the same city government during each of the 18 workers compensation injuries. Of the 18 injuries, 14 of the injuries occurred in the first two weeks of November in fourteen different years. It turns out the claimant is a deer hunter, and deer season is the last two weeks of November.
Fortunately the claimant always made a fairly quick recovery from various strains and sprains and was able to return to work on the first Monday of each December. The claimant is committing fraud by taking a two to four week leave of absence each year paid for by workers compensation. The employer knew this, and the adjuster knew it too. Why they did not prosecute the claimant for fraud is unknown.
Fraudulent Employees Often Switch Doctors
Please note that most adjusters reviewing a case like this will be aggressive about the claim when the claimant is alleging a new injury to a body part that was part of a prior injury claim.
Injured employees like Mr. Bad Luck above will often change doctors so that they can tell the doctor they have no previous injuries. The smart adjuster will share the information with the medical providers on the claimant’s prior injury by obtaining and providing the relevant medical records from the prior medical providers. Also, there is something about the claimant knowing the adjuster is aware of prior injury claims causing many claimants, even those represented by an attorney, to make a speedy recovery.
Central Index Bureau Submission as Standard Best Practice
Make sure the use of Central Index Bureau submissions is a standard part of best practices and is included in your account handling instructions.
Author Michael Stack, Principal, 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 the founder & lead trainer of Amaxx Workers’ Comp Training Center.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.