Insurance Audit: No Surprises, No Worries

  Insurance Premium Audit: No Surprises, No Worries

For most people, the word "audit" doesn’t convey happy thoughts. The key to a successful premium audit is preparation and knowing what to expect of the process. At Travelers, we want to ease any apprehensions by helping customers prepare for a premium audit at the beginning of their policy term – instead of waiting until the end.

To accomplish this, we’ve created a new customer audit welcome kit that includes some important details.

• A description of what a premium audit involves.
• Audit requirements – and why audits are a standard industry practice.
• What customers can expect during a premium audit.
• If and why a customer premium can change.
• How best to prepare for an audit.
• Frequently asked questions.

WHAT IS A PREMIUM AUDIT? Your premium has been estimated based on information provided by you or your Agent or Producer prior to the start of your policy term. Because your business may change during the policy year we want to make sure that your premium accurately reflects the state of your business over the policy term. This entails reviewing the original estimate against your actual payroll and business operations and is referred to as a premium audit. This is a standard practice and your participation in providing this information is essential in order to calculate the final premium. 

IS A PREMIUM AUDIT OPTIONAL? State regulations require us to conduct periodic premium audits of Business Insurance policies. This is an industry standard practice for all insurance companies that provide Business Insurance coverage. While the audit is a routine practice for us, we understand that it may not be for you. The enclosed FAQs provide information and tips to help you prepare. Please note that not providing requested documents may result in an Audit Noncompliance Charge or estimated audit and/or cancellation of any coverage in force at the time of audit.

 WHAT SHOULD I EXPECT? At the end of your policy period you will be contacted by our Premium Audit department letting you know it’s time to complete your audit. You will receive an invitation to complete your audit online or in-person (your type of audit is determined based on premium size, type of operation, and state requirements). In either case you will be advised as to the documents needed for your audit (refer to FAQs for examples). Your prompt attention and cooperation with the process is important to assure timely processing of your audit results. WILL MY 

PREMIUM CHANGE? After the audit is conducted your premium may be adjusted based on your business activity during the policy period. Business activity is confirmed by a review of your sales or payroll, operations, employee classifications, use of sub-contractors and inclusion or exclusion of officers. Providing accurate data ensures you don’t pay more (or less) than you should for proper insurance coverage. The enclosed FAQs includes record keeping tips that help our customers avoid surprises

Thanks for reading

p.s.

Helpful Tips to Prepare for Your Workers' Compensation Premium Audit at  https://apps.travelers.com/iwcm/AgentHQ/SmallBus/Documents/Agt_Services/premium-audit-welcome-letter-sample.pdf

Michael Fillers, CPIA, NFIP
Morris Insurance Agency, LLC

3032 Dauphin Square Connector

Mobile, AL 36607

D.251-473-5119/F.251-473-6301/C.251-753-8011

Email: mjfillers@morrisinsmobile.com

Web: www.MichaelFillers.com

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