Major problems in overseas insurance program costing the U.S. government millions

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Overseas Insurance ProgramProblems in the infrastructure of the U.S. workers’ compensation insurance program that provides coverage to contractors in Afghanistan have cost the nation millions, according to the Special Inspector General for Afghanistan Reconstruction. The audit, lead by Major Brad Willcockson, found that workers in the region often go uninsured as a result of nonexistent oversight in the program. According to the audit, the problems may lie in the programs administrator: Continental Insurance.

The insurance company is a subsidiary of CNA Financial Corp., and was pegged by the U.S. government to provide coverage as part of the workers’ compensation insurance program. The program provides coverage to workers who are laboring to rebuild Afghanistan’s infrastructure and afford them benefits if they are hurt or killed while working for the government. Continental Insurance has collected more than $225 million from premiums since the company began participating in the program in 2005, all of which is refunded to policyholders by the federal government.

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The audit found that the insurer was using a billing and reimbursement process that violated federal law and kept the government from receiving the money it was due. The audit calls for stricter regulations to be imposed on the insurer as well as regular investigations into the operation done by an independent third party.

In speaking with the Associated Press, Willcockson said he first grew suspicious of the company’s activities last year when he saw no claims coming from workers in the field.

 

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