“Slip and fall” insurance claims are starting to undergo tougher scrutiny as businesses and their insurance companies seek to combat a 57% increase in questionable claims in the last 2 ½ years.

Joe Wehrle

The National Insurance Crime Bureau (NICB) said more than 4,600 questionable claims inquiries were received in 2008, 2009 and the first half of this year. Most of those claims were tied to commercial policies.

New York, Los Angeles, Philadelphia, Las Vegas and Chicago were the five cities with the most questionable claims for slip and falls, and California, Florida, New York, Illinois and Texas were the top five states, according to the NICB.

“While many people have legitimate accidents in stores and businesses across the country, we’ve seen a growing number of cases that have some indication of potential fraud,” said Joe Wehrle, NICB president and chief executive officer, in a statement. “Our agents, working with insurance company investigators and law enforcement, are busy identifying and targeting organized criminal rings that make a good living staging slip and fall accidents.”

The NICB is working with insurers to raise awareness and encouraging companies to investigate claims before paying. However, in some cases, retailers are writing checks.

“Many retailers are self-insured and they look at this as a cost of doing business – they’ll write a check without investigating,” Wehrle said. He estimated the unwarranted payouts from self-insured companies running into the millions.

Wehrle said the NICB has increased its focus on commercial fraud, and slip and falls and workers’ compensation fraud are cases that are priorities for many of its member companies who write commercial policies.

Often, Wehrle said, the perpetrators “come into an area and hit several retailers, grocers, or other businesses with sophisticated schemes and professional execution. They hope to collect a quick payout and move on before anyone realizes what’s going on.”

Typically, a case might involve two people visiting a big box store or retailer, and splitting up. “The first person goes down an aisle while the other keeps a lookout,” he said. “When the coast is clear, he or she pulls out a small bottle of liquid, pours it on the floor and then pretends to fall on the floor. The partner runs to assist and tells everyone that he witnessed the fall.”

The number of slip and fall questionable claims submitted to NICB went from 325 in the first quarter of 2008 to a high of 565 in the fourth quarter of 2009. In the first half of 2010, there were 997 slip and fall claims referred to NICB for further analysis.