Work Comp Premium and Reserve Review Differences
The difference between Workers Compensation premium and reserve reviews comes up often during one of our presentations or in speaking with current or potential clients.
To keep from boring you to tears, we will cover Premium Reviews today and Reserve Reviews next time. We avoid the word audit when we can as the audit has such a bad connotation – IRS audit, year-end payroll audit by the insurance carrier, etc. Audits sound confrontational.
Premium Reviews – this is also called a policy review. We look at the “mechanics” of how your Workers Comp premium has been calculated. We look at various items including:
- Payroll Statements
- Current and previous Work Comp policies
- Website advertising and brochures
- Previous Work Comp year-end payroll audits from the insurance carrier
- NCCI or State Rating Bureau sheets
- Audit Billing Statements
- Audit Workpapers
- Any type of premium adjustment after initial policy issued
- Job Descriptions for each employee
- Description of Operations
We are often asked why we need website info, brochures, advertising, and a description of operations. We want to take the time to understand your company and what your company does in its operations. Without knowing it exactly, we would not be able to do a complete and accurate premium review.
We can usually go back three years from the date of the review. If we find errors, we can usually recover the error for three years, not just one. With a premium review, we are looking at the current Work Comp insurance situation and back in time for three years.
Next Time – Reserve Reviews – the hidden way to save $ on Workers Comp
PS – Our main site is at https://cutcompcosts.com/. Feel free to read our archived articles. They can be accessed by clicking on the months on the right side of the web page.
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