Insurance fraud in the US is now a $300bn a year problem according to one leading state insurance official.

Insurance Director for Illinois Michael McRaith, said his department believed it was receiving on average six fraudulent workers compensation claims each week.

He said the complaints over insurance fraud in the state had seen claimants, employers, and insurers being accused. The department put into action last summer a series of steps designed to reduce the level of workers’ comp fraud including harsher penalties against those who were found guilty, including jail sentences.

"Illinois business owners simply pay too much for workers' compensation insurance premiums," said McRaith, who was speaking of a meeting of state business leaders. “Not matter who's at fault, the fraud is increasing the cost of workers compensation insurance.”

He added: "Insurance fraud is a $300 billion national problem. The cost of workers' compensation insurance fraud can be costly on paper and in opportunity."