Tag Archives: premium audit

Insurance Premium Audit Checklist

This entry is part 5 of 5 in the series Premium Audit

Business owners are commonly contacted about completing a remium audit after an insurance policy expires or is canceled. The audit process is designed as a service to you that guarantees you only pay the premium that you owe.

What is a Premium Audit?

The primary purpose of a premium audit is to calculate your final insurance premium. When your policy was issued, the premium was an estimate of an exposure basis (usually payroll or sales) multiplied by a rate. The rate used is determined by how the exposure base is classified. The audit will examine your records to establish the actual exposure basis and make sure that the correct classification codes and rates are used in determining your final premium. Because the original premium was an estimate, the audit will mostly likely result in a change of premium and/or classifications for your business. (more…)

Insurance Cost: Understanding Premium Audits

This entry is part 4 of 5 in the series Premium Audit

There is a process involved in determining insurance cost. There is also a process after a policy period expires to ensure that the policy premium was accurate – this is a premium audit, which is designed to guarantee that business owners only pay the premium they truly owe rather than a premium based on the estimated figures provided when their insurance policy was issued. The following information will help to explain the importance of the premium audit process. (more…)

Insurance Cost: Calculating Workers Compensation Premium

This entry is part 3 of 5 in the series Premium Audit

Remember when you couldn’t wait to turn 16 and obtain the freedom that comes with a driver’s license? Then the anticipation of turning 18, becoming an adult and being able to vote. And having your first cocktail at 21. For me, the next hugely anticipated milestone was 25 – the age when my car insurance premiums would go down!

Okay, maybe that was just me.

So, why am I talking about car insurance? Well, it’s because most people understand car insurance. We know, for example, that a 16‐year‐old boy driving a sports car typically pays higher premiums than a middle‐aged married woman in a minivan, right? Statistically, teenage boys are more likely to cause accidents, report claims, and cost insurers more money than middle‐aged women. As a result, their premiums are higher. This is how insurance works: the greater the loss potential, the higher the premium. (more…)