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7 Dirty Secrets of Workers Compensation Insurance - Dirty Secret #3 PDF Print E-mail
Articles - Workers Compensation Insurance
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7 Dirty Secrets of Workers Compensation Insurance
Dirty Secret #2
Dirty Secret #3
Dirty Secret #4
Dirty Secret #5
Dirty Secret #6
Dirty Secret #7
All Pages
Page 3 of 7

Dirty Secret #3

You are penalized and overpay when the "Audit Police" make a mistake on an audit

Because your real insurance cost is determined after your policy expires, it is essential the audit is correct.

You're at a disadvantage from the start. The insurance company auditor knows the rules, you don't. The auditor is not compelled by law to explain the rules, especially if applying a rule that would cause you to pay a lower premium.

Here's how the auditor works against you:
  • Your entire payroll is put into the highest classification
  • Then, the "standard class exceptions" are put into the correct cost classification. When someone is not properly moved to the lower cost classification, you pay at the highest rate.
Misclassifications are common and the system is designed for you to pay for all mistakes. There are many other errors or omissions that are made in addition to misclassifications. Of course not. Then, why allow an insurance company auditor to conduct an audit without an expert at your side? A workers comp audit may actually cost you more money than an IRS audit. A workers comp audit is every year. You may go years without an IRS audit.

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