Common reasons why workers’ compensation claims are denied – and how to avoid

Workers’ compensation insurance, also known as workers comp coverage, is a type of business insurance policy that covers the cost of hospitalization and other medical bills and a portion of employees’ lost income if they get seriously hurt or sick while doing their jobs. This form of coverage also protects business owners from the financial liability of having to personally shoulder the expenses resulting from workplace injuries and illnesses.

Each country, and even each state or province in each country, calculates premium prices differently using a range of factors. These include the worker’s job classification – which indicates the level of risk of the job they perform – and the company’s payroll and previous workers comp claims – sometimes referred to as “experience modification.”

Countries also set who handles and sells workers’ compensation insurance policies. These may be state-run organizations, private insurance providers, or the country, province, or state itself.

Read more: First-year employees are more at risk of workplace injuries – Travelers study

While workers’ compensation policies offer a broad range of protection, they do not cover all illnesses and injuries even if these happen in the workplace. To find out the top reasons why a workers’ compensation claim may be rejected, Insurance Business referred to several specialists for their views. We also compiled practical tips from experts to help employees avoid these situations.

1. Missed deadline

Reason: Deadlines are often missed due to clerical errors and late filing of paperwork. While these instances may seem insignificant, they are among the most common reasons why a claim may be denied. Some employees also delay notifying their employers of a workplace injury, which can lead to a claim rejection.

How to avoid being denied: Insurance companies impose tight deadlines for workers’ compensation claims – and for good reason. Strict timeframes help insurers weed out fraudulent claims. To avoid having their claims denied, workers are advised to inform their employers as soon as they sustain an injury or illness while doing their jobs. For those who find filling up paperwork challenging, we recommend hiring an attorney to help.

2. The injury or illness was not work-related

Reason: An injury can be classified as nonwork-related for the following reasons:

• There were no witnesses when the injury occurred
• The injury was caused by a hobby or recreational activity, even if it happened in the workplace
• The illness or injury was a result of a pre-existing condition
• The accident happened while the worker was on the way to or going home from work, or during breaks
• The employer was not notified of the injury when it occurred

How to avoid being denied: These situations again highlight the importance of reporting a workplace injury as soon as possible. The longer you wait to report an accident, the more likely it is that your claims will be denied.

3. The injury or illness was due to horseplay

Reason: Employees…