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What to expect and how to prepare

  Keller Brown Audits When you hear the word "audits," you usually think of long and time-consuming tasks requested to ensure that your records are accurate. Rest assured, commercial insurance reviews are not as frustrating as you think. In fact, they benefit you and your business by verifying that your insurance and premiums best reflect the correct pricing of your exposures.

What to expect from an audit

Suppliers use insurance audits to determine the level of risk they insure, especially as it relates to general liability and compensation premiums for workers.

  • Commercial general liability is essential business protection that protects you and your company from claims and lawsuits against you that may occur during the operation of your business.
  • Employee Compensation protects both employees and companies. If an employee is injured at work, the insurance pays health care, lost wages and death benefits.

When the insurance period begins, we use factors such as sales revenue and salaries to determine the estimated contribution for your insurance policies. . Depending on the results of the review, you may see an adjustment of the premium (higher or lower) based on your actual exposures or results.

However, the goal is to have a difference of $ 0 in your premium after a review.

9 Affects Your Audit

In addition, it is important to note the effects COVID-19 may have on a commercial insurance audit as the pandemic continues. Have you seen a change in your sales revenue in the last year? How about an increase or decrease in salary? As you prepare for an upcoming insurance review, consider what changes you have noticed in your business and how they may affect your premium. For a deeper dive into COVID and reviews, check out our blog from July 2020.

How to prepare for your review

An insurance review usually takes place two or three months after the insurance expires. You will probably see an adjustment of the premium if there have been any significant changes in the eligible factors, such as sales, salaries, number of employees, students, etc. Any additional premiums must be paid within 30 days after an audit has been completed. To even out cash flow, you do not have to wait for an audit to begin preparing – there are several ways you can help manage your insurance premium:

  • The premium is determined by the nature of the work your employees perform and the estimated amount of sales revenue that your business expects under coverage. Be sure to keep accurate records of your financial reports, salaries, employees and their type of work.
  • Compare the salary sum and sales revenues throughout the year to assess the policy against your actual figures. If you notice any large fluctuations, contact your agent in advance to have the policy adjusted before an audit. This communication helps to avoid significant premium adjustments later.
  • Some insurance companies may offer billing plans to help you pay as you go, by smoothing out cash flows and taking into account salary fluctuations to make premium adjustments before an audit is necessary.
  • Do you want to reduce the potential effect of an insurance audit? Use the most accurate salary and sales income when creating the policy. Lowering these figures can lead to significant changes in your overall responsibility and long-term workers' compensation premiums.
  • If you use subcontractors, be sure to collect insurance certificates and have written agreements registered. Be prepared to present them during the review. Otherwise, these parts can be treated as employees, which means that your employees' compensation and general liability premiums will increase.

We are here to help

Talk to our insurance specialists today for a free review and quote for commercial general liability or employee policy. We have the flexibility to find the right coverage and competitive premiums with several top-ranked suppliers. To get started, contact Keller-Brown Insurance Services today by visiting www.keller-brown.com/contactus or calling (717) 235-6891.

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