An employer who misrepresents the amount of payroll or classification of employees in order to reduce workers' compensation costs commits:
A) premium abuse.
B) premium fraud.
C) benefit abuse.
D) benefit fraud.

Question

Quizplus · Accepted Answer

Misrepresenting payroll or employee classification in order to reduce workers' compensation costs is considered premium fraud because it results in a lower premium payment than what is actually owed. Benefit abuse and benefit fraud are not applicable in this situation as they refer to improper use or theft of benefits by the individual receiving them. Premium abuse is not the correct term as it does not specifically refer to misrepresenting payroll or employee classification.

An Employer Who Misrepresents the Amount of Payroll or Classification