Offer Warning – Before the Premium Audit
A certain type of audit offer warning for our blog readers was required after two phone calls this week.
As I have discussed many types; and as you will see in the heading of this article, we, of course, perform audits for employers and governmental agencies. Our audits are basically a review of the last three years for policy overcharges. This is one of a group of our services.
(c) 123rf.com
I have received two phone calls this week that were disturbing to say the least. One employer from CA and another from WV both called to ask about a service that where the auditor would come in and basically set up the business book BEFORE the premium audit by the insurance carrier. This is highly illegal.
From what I could gather, the so-called premium auditing company’s goal was to lower the premium BEFORE THE AUDIT. That is a good way to spend time in jail. I had written about this type of unscrupulous audit here and here. The company owner and the premium auditing consultant are now both doing hard time in a South Carolina prison.
Honesty is always the best policy when dealing with insurance company premium auditors. Your company should pay every cent in premiums you owe, but nary a cent more.
These types of bad-actor companies give the premium auditing and risk management consulting professions a bad name to say the least. Do not end up being accused of the “F” word in insurance. California has added some very strong laws dealing with this subject. I will cover that next time.
