Workers comp attorney explains dispute, and how Michigan can be affected by insurance companies who under-report premiums
The Wall Street Journal recently reported that AIG has tentatively agreed to pay $450 million to resolve a lawsuit involving under-reporting of premiums on workers compensation policies. Here’s what rival insurance companies acuse AIG of doing:
It has been alleged that AIG was part of a $1 billion dollar under-reporting scheme of workers compensation premiums. The lawsuit was filed by two insurance companies and could affect up to 600 interested parties.
AIG has already agreed to pay a $100 million fine and $46.5 million in taxes and assessments to various states for alleged workers comp abuse.
“The state investigation, led by Pennsylvania regulators, found that AIG misreported more than $2 billion in workers’ compensation premiums. The size of an insurer’s business, calculated from its premiums, determines each firm’s share of contributions to state-mandated pools that cover injured workers who can’t get coverage from the private sector.”
Why our work comp attorneys say this a big deal for both employers and employees in Michigan
Many states have workers compensation insurance funds that both employers and employees rely upon. These funds help support the workers compensation system by keeping costs low for business and ensuring that injured workers are fairly compensated.
How Michigan can be affected by insurance companies who under-report workers compensation premiums
Michigan has a Second Injury Fund that was created to encourage business to hire a worker with an injury. The Second Injury Fund also provides benefits for total and permanent disability and for certified vocationally handicapped (disabled) workers.
The Second Injury Fund is financed by self-insured employers and insurance companies. Insurance companies pay into the Second Injury Fund based on the proportionate amount of premium they write.
When an insurance company does not accurately report its workers compensation insurance premiums, it pays less into the system at the expense of employers and employees who are playing by the rules.
Don’t let insurance companies play games with your workers compensation benefits
To speak with one of our workers compensation attorneys, call (855) 221-2667 for a free consultation. There is no fee unless workers compensation benefits are recovered for you.
– Alex Berman is the founder of the law firm. Hes been representing injured and disabled workers exclusively for more than 30 years. Alex has helped countless people obtain workers compensation benefits and never charges a fee to review a case.
Injured at work in Michigan? Your exclusive remedy is workers compensation.
You can afford a great workers compensation lawyer.
– Photo courtesy of Creative Commons, by Patrick Barry Barr.