A self-insured employer has denied a claim but the file does not properly document the reason for the denial. What is the amount of the penalty?

A self-insured employer has denied a claim but the file does not properly document the reason for the denial. What is the amount of the penalty?

• A. $500
• B. $1,000
• C. $5,000
• D. $10,000

Answer: (C)

Penalties exist when a self‑insured employer denies a claim without documenting the reason in the claim file. The requirement is that the file show a clear, written rationale for denial supported by the facts. When that documentation is missing, the enforcement framework imposes a penalty to deter this improper handling. The amount for this violation is five thousand dollars. This reflects the standard penalty level for failure to provide a properly documented denial. Other dollar amounts correspond to different violations or circumstances, so they don’t apply to this specific failure.

Penalties exist when a self‑insured employer denies a claim without documenting the reason in the claim file. The requirement is that the file show a clear, written rationale for denial supported by the facts. When that documentation is missing, the enforcement framework imposes a penalty to deter this improper handling. The amount for this violation is five thousand dollars. This reflects the standard penalty level for failure to provide a properly documented denial. Other dollar amounts correspond to different violations or circumstances, so they don’t apply to this specific failure.