Two Employers Are Having 23 Years of Workers Comp Premium Audits

These are sad but true cases of where two Workers Comp Insurance carriers are trying to audit their clients a total of 23 years in the past.  One of the employers has already been audited twice per year for eight years, but that is not good enough for the insurance carrier. The other employer is having audit requests going back 15 years.   This is becoming more prevalent as workers comp insurance carriers are trying to increase their intake of premiums without having to incur any more risk.      

Did these two employers do anything wrong?  No, as they allowed the premium auditors to go over their books each year.  Do the insurance carriers have the right to re-audit or re-re-audit employers?  The answer to both questions is an emphatic - no.  The insurance carrier premium auditors get their one shot to audit premiums.  After that, there is a little grey area, but insurance companies are not allowed to keep auditing the employers.  

What can an employer do if there are multiple audits with requests for even more audits for the same year?  If the insurance carrier threatens cancellation if they are not allowed another audit, the scenario can become very complicated. 

I recommend: 

• Knowing or exploring your state's Workers Comp audit rules
• Writing a letter to the premium auditor advising them that they have already audited your company's Workers Comp payroll and class codes
• Contacting a premium expert
• Complaining to your state's insurance commissioner only as a last resort and/or if there is a pending cancellation 

One of the caveats of this advice is the employer must have  100% cooperated with the premium auditor during the premium audit.  I have posted previously on cooperating with the premium auditor.  You may want to use the search box at the top right part of the web page or just scroll down until you find the information on what information a premium auditor can examine.