Workers Compensation Fraud: $34B Annual Burden

NCCI estimates workers compensation fraud costs $34 billion annually, equivalent to 66% of total WC premiums. Between 10-25% of claims contain some fraudulent element, from exaggeration to complete fabrication.

Employer premium fraud through worker misclassification costs $9 billion per year, with construction leading at 31% misclassification. California has the highest state fraud rate at 19%. Only 1,247 convictions from 101,200 referrals in 2023.

Analysis based on NCCI Research, Coalition Against Insurance Fraud, WCRI studies, and state-level fraud bureau data.