Premium audits are vitally important. They determine the final premium for an insurance policy, and the data collected during an audit is later submitted to rating organizations, such as NCCI and independent bureaus. This information is used in developing experience mods Workers' Compensation premiums are estimated at the start of a policy and are based on expected business operation and payroll information. To ensure these figures are accurate and classifications remain appropriate, all Workers' Compensation policies are subject to an audit to determine the actual premium. The audit takes estimated payroll and converts the policy premiums, so they are based on actual payroll. Audits are required by Workers' Compensation.
The WC audit determines the final premium for an insurance policy, the data collected at time of audit helps Normandy review payrolls, class codes and claims data. The premium audit needs to be accurate, verified, and in compliance with mandated rules and regulations. It also gives you an overview of the full year's records.
The audit will be estimated per State statute a surcharge of up to 300% can be applied to your policy, your policy can be placed in cancellation for non-compliance of the audit. Please note even if the estimated audit is paid, the cancellation will not be lifted until the actual audit is completed.
Insureds will need to complete the audit form and questionnaire we su pply, return it via mail, fax or email. Including their federal 941's forms, state quarterly reports, or a detailed payroll summary for the policy period.
We have vendors that we partner with, once they get the assignment, they will contact you either by USPS, email or phone.
The following information will be need it by the auditor per policy period:
1. Detailed Payroll Report (separate & total by class/job type and Officers) for Period.
2. State Quarterly Report (Department of Revenue Employer's Quarterly Report)
3. 941's (Employer's Quarterly Federal Tax Return)
4. Payroll Register
5. General ledger
6. Profit & loss Statement
7. Names and amounts paid to each subcontractor along with copies of Certificates of Insurance or Exemption forms covering the audit period.
*About Officer's Certification: Please verify with your Agent of record that your exemption is valid and up to date.
One-third of the overtime payroll is allowed to be excluded. The same would hold true with double time. We include half of the double-time payroll to come up with the amount of st raight time payroll. In some states, overtime pay is included, please check your state requirements to be sure.
Yes, audits are based on expired policies. Every policyholder is required to finalize every policy.
Yes, per each state's statute, an audit it to be performed at the end of the policy period to finalize actual payroll figures
Please contact your Agent of Record and/or our Audit Department at 866-688-6442, option #3.