State Fund Today

The California Department of Insurance estimates that workers’ compensation fraud costs the state between $1 billion and $3 billion annually. Much of the cost to administer workers’ compensation in California, and most of the processing bureaucracy that injured workers and providers experience, is due to fraud. 

Almost all the injured workers, providers, and businesses we interact with are honest and do not commit fraud. However, historically, fraud has driven costs so high that the California workers’ compensation system has generally been the most expensive in the country.  And the actual benefits injured workers receive rank somewhere in the middle. Over the last ten years, our legislature has focused more on reducing systemic fraud and abuse, and as a result California is no longer the most expensive state for workers’ compensation in the country. 

Our statewide Special Investigation Unit (SIU) aggressively investigates suspected fraud. Since 2020, the amount of fraud that SIU has successfully pursued has increased remarkably. Here is a snapshot of their success:

 *2024 figures are through 11-30-2024

Over the last four years, the number of cases we worked with law enforcement to successfully prosecute has grown, and the amount of money that we get back in restitution has doubled. We have successfully pursued cases against vendors, workers who lie to receive greater benefits, and policyholders who do not tell us the truth about their exposure. If you or your clients would like to learn more about how fraud effects everyone, please watch our Workers’ Compensation Fraud webinar.