Imagine you own a national restaurant chain, and a customer with a tomato allergy comes in and eats your guacamole, which has tomatoes in it. She puts in a claim against your company.
So far, this isn’t an uncommon scenario. But what you didn’t know at first is that this customer was a professional actress, who listed one skill as being able to cry on demand. Also, before she left the restaurant, she started a GoFundMe account to ask for money because she had to go to the emergency room and couldn’t afford the bill.
Business owners don’t have the time or skills to investigate questionable workers’ compensation or general liability claims. They need to focus on their business.
“You need someone to fight on your behalf. You need someone to get the documentation of what’s really going on,” says Kerry Stafford, Northeast regional claim manager at Arthur J. Gallagher. “You need someone to be an extension of your staff. Does this claim make sense? If it doesn’t make sense, let me dig in and use social media and surveillance.”
Smart Business spoke with Stafford about claims advocacy, including how technology provides new opportunities to find the truth.
What do claims managers like yourself do?
Claims advocacy is an added benefit at some insurance brokerages. They have the time and know-how to investigate questionable claims. They can better position an employers’ case, especially with the increased use of technology and social media. Claims advocates work on your behalf, peeling back layers like an onion, to find out what’s really going on and then provide that documentation to the insurance carrier. They also can help you determine if you should deny a claim, or position your organization for a lower settlement.
Don’t insurance companies check this?
Insurance carriers usually have to pay an outside vendor to investigate claims. In addition, their case adjustors have high caseloads and don’t really have time to look in depth.
With questionable claims, how would an employer know what red flags to watch for?
For a worker’s compensation claim, you should investigate further if the accident was not witnessed, or involved a short-term employee, an employee getting ready to retire or an employee who has been involved with prior claims. With a general liability claim, again a prior history of claims or no witnesses should throw up red flags.
You may or may not have video; but if you do, make sure you pull it before it gets erased. You also may not know that someone has a history of submitting claims, but your claims manager can search court records or other resources to trace past settlements.
If something doesn’t smell right, then start asking questions and get a good claims advocate to help you uncover the real story.
What are examples where technology has changed the way employers can protect themselves from fraudulent claims?
It’s amazing how often people post on social media — Facebook, Twitter, Instagram, etc. — and contradict what they claim.
They can be out of work because of a shoulder injury but still post pictures that show them paddle boarding in Myrtle Beach. One questionable claimant sold goods on Etsy and made money babysitting, while claiming to be too injured to work. Are they out shoveling snow with a supposed bad back? Have the missing construction tools showed up on Craig’s List? Did they cancel an independent medical exam, but then post that they went for a new tattoo?
Some cases are legitimate, but you want to be positioned correctly for the settlement. For example, a retail clerk was beat up while at work. Years later, the company was about to offer a multimillion-dollar settlement because she allegedly couldn’t see or leave the house. However, Facebook showed her dancing on a bar with drinks in each hand, which allowed the business to decrease the settlement amount.
Also, to utilize technology even further, drones can be used for surveillance.
As a business owner, you know there’s a probability of fraudulent claims, for both general liability and workers’ compensation. Not only might you pay a high settlement that affects your bottom line, that settlement in turn affects your insurance rates and reserves. Make sure you’ve got someone in your corner to help you find the truth.
Insights Insurance/Risk Management is brought to you by Arthur J. Gallagher & Co.
