What Is An Audit And Why Do I Need One?
Insurance audits are typically performed on general liability and workers compensation policies. When your policy was started, your annual premium was based on an estimated exposure (payroll, sales, etc). An audit will take place at the end of the policy period to ensure the proper premium was charged based on actual exposure versus estimated exposure.
Audits are often times done via email or phone, but an on-site audit could also be scheduled by the auditor for larger or more complex operations. It is in your best interest to have the audit done as it makes sure that you are being charged an accurate premium for your exposure.
How Do I Prepare For An Audit?
Good record keeping is key to a smooth audit. Accurate records provide and confirm information, save time and minimize insurance costs. The premium auditor will let you know exactly what will be needed, but some (or all) of the following records will be reviewed:
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Payroll records and tax forms
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Employee records
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Sales information
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Certificates of insurance from subcontractors
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Income and Expense statements
Your audit process will start shortly after the policy renews or expires. The insurance company will reach out to you to let you know how the audit will be conducted (via mail, via phone, online, or in person) along with contact information for the auditor that will be working with you.
If you have any questions about the audit process, please feel free to reach out. We’re happy to help you prepare for the audit in any way we can.
