Grinberg: Be Ever Vigilant

Thursday, February 10, 2022 | 0

Another week and another bit of news just to help us appreciate the various dangers facing employers in California.

Gregory Grinberg

The Department of Insurance reports the sentencing of Karyl Lynn Reed for various fraud charges stemming from operating as an unlicensed insurance agent. According to the press release, she collected premiums through Envoy Business Partners and Allenn Specialty Group. She issued bogus certificates of insurance. Her victims paid for the policies and operated thinking they were covered by a workers’ compensation policy when, in fact, they were uninsured.

Of course, aside from running a business and having to be on the lookout for fraudulent workers’ compensation claims made by employees (or alleged employees), California’s employers must also be on guard for the other side of the equation: fraudulent insurance agents leaving employers exposed when on-the-job injuries occur.

If you’re considering engaging an insurance broker for a policy, there are a few things you can do to verify that you are actually covered. For one, ask to see the insurance agent’s license and run the credentials through the state’s license verification website.  Another step to take is, upon receiving a certificate of insurance and confirmation that the premium is paid, contact your insurance company directly and confirm that a valid policy exists for your business. 

I have represented parties alleged to have been illegally uninsured for workers’ compensation at the time of injury, and if you thought the deck was stacked against an insured employer, it is doubly so for an employer forced to unexpectedly adjust and defend a claim without the resources and expertise of a claims adjuster. Exposure to severe penalties and costs await any employer so unfortunate as to find itself on the receiving end of an allegedly uninsured claim.

I tip my hat to justice being done —  the sentence is four years in prison and a restitution order of more than $1.4 million — and hope we can all profit from this news to remain vigilant from all sides.

Gregory Grinberg is managing partner of Gale, Sutow & Associates’ S.F. Bay South office and a certified specialist in workers’ compensation law. This post is reprinted with permission from Grinberg’s WCDefenseCA blog.