The first thing you need to know is why an audit is being requested. Your workers compensation premium is ultimately determined by your exposures. The two basic exposure types for a workers compensation policy are payroll (remuneration) and total cost of uninsured contractors. When your policy is first set up your policy premium is based on an estimated exposure. This estimate should come from you after you’ve been informed how an auditable policy works, not made up or guessed at by your insurance agent. Your estimate should have been your best projection for the coming policy period.
Shortly after your policy expires, your actual exposure during the policy period will be determined by the audit. After the audit of your workers compensation policy is completed by your insurance carrier they will prepare and send to you a final audit statement. This statement will indicate any additional premium you owe or any credit you will receive due to the payroll adjustment as determined by the auditor. You should receive the audit billing statement usually within three months after the end of your workers compensation policy period.
So what is the auditor really looking for? The answer is payroll. Payroll, is defined as a workers compensation term, which includes payments to others as uninsured contractors.
Records you need to have available
When preparing for your workers compensation audit you need to make available to the auditor only those items they ask for. Don’t give them or volunteer more information than they ask for. Remember, the quicker an auditor can finish his job and move onto another audit, the better it is for you and for them. Here’s some of the items they may need to do their job:
Payroll Records to include:
Cash Disbursements showing:
Certificates of Insurance
Helpful Hints and Tips
When preparing for your audit keep these helpful hints in mind. They will save you time and cut down on errors the auditor may make.
Simplify the Auditors job. The auditor is on a very strict time schedule. Every time an appointment is missed or has to be postponed it creates havoc in their life. So if a physical audit is being completed you want to do everything you can to make sure the auditors job goes smoothly. Here’s some suggestions:
A word of caution. Many auditors prefer to just gather data then take it home or to the office and finish it up. This is never a good process. You should always have the chance to review the auditors work before they
leave your office so you are aware of how they classed your employees and what the potential impact the audit will have on your business. You will be asked to sign the auditor’s worksheet before they leave. You should never sign an incomplete worksheet. You should always ask for and keep a copy for your files.
Every Workers’ Compensation policy is subject to an audit. However, having a pay-as-you-go policy can help minimize the impact of a premium audit because premium is based on actual payroll and not estimated payroll.
You can request a payment plan for your balance due by emailing service@CoverEase.com.
If your policy is with Travelers Insurance, CoverEases’ E-COMP program will deduct these funds from the same account that we have used to bill your premium. You will receive a notice 2 days prior to the withdrawal.
If your policy is with any other insurance carrier, you will receive an invoice and payment instructions directly from the carrier.
We are happy to answer any questions related to your audit, email service@CoverEase.com and you will receive a response within 1 business day.
You can email service@CoverEase.com and we can assist you with disputing your audit findings.
There are a number of reasons why an additional amount may be due:
Here are a few things you need to know about the audit dispute process. Keep in mind these are only provided to you as a guide. The exact process may differ depending on your insurance carrier or workers compensation providers’ specific audit dispute requirements.
How can you tell if you need to file a workers compensation audit dispute? Here’s a few things to look for:
What you need to do to file a work comp audit dispute with your workers compensation provider:
Filing a formal work comp audit dispute will accomplish this:
The formal workers compensation audit dispute request must be submitted to the insurance carrier in writing along with all paperwork supporting your belief. If this process is not followed the insurance carrier may continue all collection procedures against you which may include turning your account over to a collection agency. Do they really do that? Yes they do.
Here’s a few things to keep in mind if you feel your audit is incorrect:
Do not wait until the last minute to respond to your audit.
Be proactive at correcting your audit.
Follow the rules established by your insurance carrier for filing a workers compensation audit dispute.
If you are having trouble filing a workers compensation audit dispute, have filed a dispute and it’s not going in a favorable direction or would like assistance with your work comp audit dispute, you should contact CoverEase at service@CoverEase.com for assistance.
Insurance services provided by CoverEase Insurance Services, LLC and its licensed agents and affiliates. The information contained within these materials are confidential and not to be distributed. Descriptions are general in nature only. Please refer to the terms and conditions of policies offered or purchased. Insurance products are subject to application and underwriting requirements. Pricing depends on a variety of factors including policyholder location. Not all discounts available in all states. Not all products available in all states. Use of and access to this information, site or any of the links contained within this site does not create a relationship between the user and CoverEase. © 2022 CoverEase, Inc. All Rights Reserved.