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Protecting Your Business From A Dishonest Employee: The Workers’ Comp Edition

You want to believe that you have hired people with integrity and a strong work ethic. After all, starting a small business takes hard work, and if your employees aren’t willing to go the extra mile, getting your business off the ground will be no small task.

It’s hard to believe that anyone you personally interviewed and hired would be capable of workplace dishonesty. Wouldn’t you be able to tell during the interview process? Wouldn’t their references have told you? Workers’ comp can be awfully tempting for an already mendacious person to try and take advantage of, and plenty of people do.

Here are some ways to spot a lying employee and to prevent them from committing fraud using your business insurance.

Workers’ Comp: Keeping Your Business Honest

According to, one in four small-business owners have installed video cameras to survey their sales floor, back room and other business areas should an employee suffer an injury during working hours. In having surveillance cameras, business owners are able to provide proof of injury to their insurance provider so their employee can qualify for workers’ comp. The other reason for surveillance? To make sure a questionable employee isn’t lying about how their injury occurred.

Workers’ compensation fraud costs over $7.2 billion a year in the U.S., and has increased by 24 percent since 2013. Every time you file a claim with your small-business insurer, your premiums are going to rise. To keep from becoming a corrupt employee’s pawn, watch out for these four scenarios.

Time Injury Occurred

If an employee comes into work on Monday and within the first hour falls down, trips or drops a product on their foot and there are not any witnesses, that should be an immediate red flag. What is more likely is the employee strained themselves during the weekend, and instead of paying for a doctor’s visit out of their own pocket, wants the workers’ comp you offer to cover it. And if it should go through, they could also essentially get a paid vacation.

Fake Injuries

If the employee complains of pain from pulling a muscle after lifting a box or says they think they have carpel tunnel from typing all day without supportive ergonomic support, yet they move about gracefully and appear to have no trouble going out and doing things after hours, then you know they are not being entirely honest.

No Witnesses

If there are witnesses to support the “injured” employee’s claims, it’ll be tough to prove or disprove that they were actually hurt during work hours performing work-related tasks. Those intent on committing insurance fraud will make sure there are no witnesses to the accident, this guarantees that you have to take them at their word. If you try to disprove them, you will be viewed as a cold-hearted employer.


This is when an injured employee takes advantage of their required time off and extends the back-to-work date by stating that they are still hurt and unable to work.

You want to take people at face value, but some people are very talented in deception. Don’t be taken advantage of. Learn more about workers’ comp and other small business insurance policies with CoverHound today.

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