WorkSafe Victoria agents denied workers their rightful entitlements by ignoring evidence to “reject or terminate” compensation claims, the Victorian Ombudsman says following an investigation.

The probe covered 65 complex claims decisions that were made mostly in 2014/15 involving the scheme’s agents Allianz, CGU, Gallagher Bassett, QBE and Xchanging. QBE ceased being an agent on June 30.

The Ombudsman says the system “is not broken” but the dispute resolution process, including rewards for terminating claims, must be reviewed.

“We found agents cherry-picking evidence to support a decision to reject or terminate a claim – as little as one line in a medical report – while disregarding overwhelming evidence to the contrary,” Ombudsman Deborah Glass said.

“We found independent medical examiners – whose opinions agents use to support their decision-making on compensation – receiving selective, incomplete or inaccurate information.

“We also saw evidence of decisions being influenced by financial incentives to terminate claims. WorkSafe needs to examine its incentives – and the use of independent medical examiners – to ensure the system rewards sustainable decisions and to target its oversight accordingly.”

WorkSafe Victoria CEO Clare Amies says work is under way to improve the scheme, which manages more than 90,000 claims and makes more than 2 million decisions each year in relation to compensation and treatment.

“WorkSafe acknowledges the report highlights a number of cases in which injured workers were not given the support and respect all injured workers deserve,” Ms Amies said.

“It also found instances of conduct that were totally unacceptable.

“As the Ombudsman identified in her report, WorkSafe has already begun work in a number of other key areas to further improve decision-making processes.”

CGU, Allianz and Xchanging told insuranceNEWS.com.au they will consult with WorkSafe to improve the scheme.

“This is an important report,” a CGU spokesman said. “It shows we need to improve how we look after injured workers and review our practices to deliver a stronger and responsible workers’ compensation scheme for Victorians.

“We will work closely with WorkSafe to implement the report’s recommendations, to ensure Victoria’s compensation scheme continues to provide fair outcomes to injured workers and employers, and ensure they are treated with compassion and respect.”

An Allianz spokesman says the insurer “will be working with WorkSafe Victoria to consider the report’s recommendations in the coming weeks”.

“We have thoroughly reviewed the particular Allianz cases raised in the report and are confident that decisions to continue or cease benefits were made carefully and in accordance with legislation.”

Xchanging says it “will work in consultation with WorkSafe and other relevant parties in relation to the matters raised in the report”.

QBE and Gallagher Bassett declined to comment when contacted by insuranceNEWS.com.au and asked that queries be directed to WorkSafe Victoria.