AmTrust’s Matt Zender, VP of Workers’ Compensation Product Manager, recently shared some thoughts about how employer insurance premium fraud can hurt everyone, including honest businesses, in an article on Risk & Insurance.
The article discusses the fact prosecuting premium fraud can be an especially delicate subject for workers’ compensation insurers. It’s an expensive process that often leads to little financial return. In fact, some insurers even believe premium-fraud losses are simply part of the business.
One of the most common forms of premium fraud occurs when businesses purposely mislabel workers as independent contractors. Misclassifying employees often means honest businesses cannot compete against those operations who neglect their legal obligation to purchase workers’ compensation coverage.
Additionally, according to Matt Zender, in the restaurant industry premium fraud is a common occurrence due to the amount of cash these organizations handle, allowing them to pay workers without it registering as a payroll expense.
Check out the full article here. Workers’ Compensation Coverage from AmTrust
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This material is for informational purposes only and is not legal or business advice. Neither AmTrust Financial Services, Inc. nor any of its subsidiaries or affiliates represents or warrants that the information contained herein is appropriate or suitable for any specific business or legal purpose. Readers seeking resolution of specific questions should consult their business and/or legal advisors.